>> let's take that. what about private rights of action? epic brought administrative procedure action. there are a number of cases around the country. your thoughts on how this goes in the courts. >> we've seen a number of travelers who brought cases against the t.s.a. there is a provision if you bring a case against the t.s.a. you have to do it in d.c. circuit court. generally, it will be difficult to challenge this year the courts have taken forget to that the tsa has a wide latitude in the search is a candy within an airport. they give great deference to the agency on the fourth amendment issues. , the is, of course possibility that someone is bringing the lawsuit, if you ring -- if you bring the suit to a court that does not have as

much sympathy for the agency, there really isn't a whole lot of field choice within the scenario. then there may be a better outcome. but it still needs to be wrought through the d.c. circuit court. tothere are cases going on partially address one of those questions. two of the most significant -- corbett versus napolitano -- brought by a non-lawyer myself your entrepreneur, john corbett who has done a remarkable job as a non-lawyer. they are still pursuing them on appeal. the first circuit in boston will be hearing red friend versus napolitano tomorrow morning. it was rocked by a couple of harvard law students. private rights of action are

not entirely dead, but they continue to throw as many procedural barriers as they can. >> and there is the possibility to sue under the fta. it's an issue that we have been following for several years. we may end up filing suit under the apa under a similar fashion as we followed suit -- as we filed suit under this one. expeditiouslyrs pursuing their rights. [laughter] >> a correspondent here from a post meet a candidate. the passenger who choose not to fly to new york, who choose to drive, you are monitored along the highway. your phone can be accessed here in if you -- accessed. how is gps factoring into dragnet and what do you feel will be mined by the gps constant recognition of where we are?

>> the gps you have in your phone, right now, there is not a lot of detection for that location information. we have asked, to issue some kind of compensable a just and that will protect location information and congress has failed to deliver. there is also the issue of automated licensing readers. we saw this recently. when we filed the freedom of information act with the border protection. it is the only agency we can get to respond to our freedom of information act requests in anything under the a year -- under a year. we got back several memorandums of understanding that they had. they have been sharing the license plate data, not just with other federal agencies, but with third-party companies. they have in sharing that license plate reader data with insurance companies and car companies who have been cheering it more widely with a larger web of companies that are part of what they called the en dlet database.

these are law enforcement agencies as well as companies associated with those in doing security-related work. this data gets shared out and shared out and shared out on a wider and wider scale. so the license plate reader is definitely something to pay attention to. there is a lot of them in d.c. there are a lot of them in maryland and i think in virginia as well. there's is not a lot of regulation around that as well. there is some hope about -- hope for the privacy location data. the gps case last year, the court ruled unanimously that there is a privacy interest in location data. but we are winning for that to trickle down and agencies have been attacking that. law-enforcement agencies have been attacking that pretty roundly. >> this is one of the loopholes that you can drive a truck through. cbp operates under what they claim as the complete border exception to the fourth

amendment. which makes border regions -- we are in a border region now because we are within 200 miles of the ocean -- they consider border regions to be the [indiscernible] gpshey say they can have data where most people live without any regulation whatsoever. i don't care that much about this information. part of the problem is what is innocuous here and now may be something that you have strong reasons to keep private somewhere else or at some other time or different rules apply, especially if you are traveling internationally, or where policy is legal can change for better or for worse with time. that is part of the particular danger of not really looking at this stuff now, but reporting it in your permanent file against that future when

whatever category it is you fall into maybe the one that is getting rounded up. >> and particularly on the privacy and locations of location data and all of the sort of sensitive data that can come out if your location is being tracked, you may be going to a religious institution or a political rally or an abortion clinic or a particular kind of doctor's office, a therapist's office, and all of that is very private information that you might not want to be logged forever in some paper file somewhere. >> down here in the front. >> a dozen years ago, i back tracked around the world for 20 months. around thekpacked world for 20 months and i used your work. for those of you who don't know, he is a living legend in the travel world. among back to the right to , right toat law

travel the navigable airspace, that seems narrow. what is the big ensure of our right to travel and what are reasonable exceptions? i think it is reasonable to record the identities of everyone that crosses the border and not all the data -- not all the data you are showing us, but something. what would be reasonable exceptions and limitations? -- where does the right to travel come from? we were talking about that. constitutionally, it counts both as part of the first amendment, which guarantees the right to assemble. to assemble is an active verb. it means to come together in an assembly. the first amendment right to assemble means the right to travel, to be together, as when we came here. it's also the right to travel -- it's also one of those

enumerated rights that are, by the constitution, reserved to the people. and you can also get to the framework of it through international human rights during as far as what should the exceptions to the rights of travel, when you should be prevented from travel -- you should be prevented when a court has issued a junction. note fly injunction. you are threatening to kill me and our children so i want the court to order you not to walk down my block. we have established legal process for no walk ordinances good they could be followed -- ordinances. they could be followed. but the united states has never fought a no fly injunction. they have no authority for that. so interference, stopping you from travel should be based on a court injunction unless there is a basis for arresting you on

this pot. if you are not under arrest and under no injunction, as far as what conditions should be put upon it, that comes back to the scrutiny. those conditions that can be justified as actually effective and necessary for legitimate work this and that are the least restrictive alternatives that could serve that purpose. >> i want to talk about that injunction thing. we found something very interesting in the freedom information act documents that we got from the -- from the fbi a few years back from the no-fly list. we found that come even if a is court gives you a quibble on a charge, you could still be included on the no-fly list -- gives you an acquittal on a charge, you can still be included on the no-fly list. you will find out that you are on the no-fly list it does come according to the guidelines, it is illegal for them to give you any information indicating that you are on that list.

>> down here. >> my young daughter was searched at 13. the person definitely didn't know what they were doing. you have your breasts squeezed. you have inappropriate behavior that no one else would be allowed. but there you say something, then you will go on your trip. so you have to allow someone to basically -- do they have any type of guidelines on the people they choose? you have to sit there and allow your child to be abused by somebody) of you and it's disgusting. >> i have never seen the guidelines during this is a

very good moment to point out the sort of effectiveness that we and -- that we as citizens can engage in with the agency. when they started doing these enhanced at downs, people protested, especially parents on behalf of the small children who were being patted down by tsa officials. and the agency did change its practice after that. children under the age of 12 are no longer subject to the same sorts of pat downs or body scanner machines. we do want to push back on the agency. we can create real change. but that requires that we actually participate in the democratic notice and promise process. >> there are no rules. that is the problem. >> another question. along the aisle. >> would you go further on what you talked about on the results of what this has been.

tammy terrorists have been caught? tsa has now spent a hundred billion dollars since nine/11 trying to catch terrorists and how many have we gotten? quest that is a very valid question -- >> that is a very valid question. the things that the government participates in that make us feel saver but don't actually eliminate that much more risk and often times programs are very evasive, very invasive, very expensive, but there isn't that much correlation between the elimination of threats in those costs. i think it is having somebody who is a real expert with you presented should present comments on the -- comments to the agency on this topic. >> the answer appears to be zero. congress hasn't pursued this question too much. it has testified at hearings at the european prominent in

brussels. their members of parliament have pressed this question. and the response from dhs is that this has been a success because we have stopped so many people from traveling. but what they haven't said is anything to clarify whether those are examples of success or whether those are examples of cases in which they have deprived people of their rights. those are not people who have been convicted of anything and it appears that, in general, they have. when pressed for success, they talk about how many arresting you look at drug arrests. >> looking at the recent history of attempted conclaves, it might be more worthwhile for the agency to spend its money on some basic training for americans -- american citizens on how to disarm a terrorist. >> it's worth notice -- it is worth noting that terrorist caught is not always shown in a program like this, but a deterrence.

could curtail what they were planning. if that is the case, then we could have the machines not collect any information at all and just have people run through and make them think that they are being collected. we are certain to run short on time. i have two questions. i will start with the curveball coul. our audience may have picked up that neither of you are libertarians. i wonder what you think about the policy a referral to a medley, which is to restore responsibility for security to whatsirlines and to the -- would the accountability would be like? >> i think we would be facing the same issues. the collection of data wouldn't make a big difference to me or who it is that is

using these machines and who it is that the lyrics the data, special ash that is collecting the data -- that is collecting the data. perhaps there would be more of a push toward cost-effectiveness. but i don't know. it's hard to tell. >> the airline industry receives enormous subsidies in part in exchange for their use of public resources in their agreement to operate as common carriers. again, this is begin more personally, but i think the choice was made in early pioneer active deregulation in 1978. the choice was made to allow airlines free choice of setting their own prices at least a mystically.

but those provisions i showed you earlier requiring them to respect travel as a right and require them to operate in a nondiscriminatory way as a common carrier, they were retained. the key thing, if you were to transfer security back to the airlines, it would be to maintain and actually enforce the continued obligation that they actually operate as common carriers and free travel as a right. and if you don't want to take on all comers, then you become a charter operator and you can pick and choose who you want to travel with. if you want to license and operate as a common carrier, you need to respect the rights of your customers. >> at the very least, we would get more pleases and thank use -- and thank yous. the general project of bringing the suit that you did and the tsaments -- tinyurl.com/

comment, for those of you who want to register your comments -- the overall arch is trying to bring the transportation security administration in at least one respect under the rule of law. and allow what we have been talking about here today, the rule of law, with regard to air transportation and air security, with the issuance of this exceedingly slim and somewhat contemptuous notice of what the regulation is given that the second-highest court in the land asked for it, i wonder if we have not set back in that project. the regulation will be rejected in the courts when it finally gets there. and we will have another few years of work to get a good regulation that can then be challenged on the substance of whether this provide security benefits in exchange for the cost. but i want to hear your prognosis, what you think happens, how this plays out, how

long it takes to get the tsa under the yoke of law if we can't just get rid of it. >> i think we just keep whittling at it. publiclook at the response to body scanners, they were subjecting airline pilots to body scanners. if you are an airline pilot, you are already flying a plane and yard have control of a plane and you could destroy it if you so choose. assumably, you have gone through the proper clearance program to ensure that you are responsible enough to fly that plane. so why should you have to go through the body scanner? the agency has since made an exception for the airline pilots, an exception for small children, at least in regards to some screening. we have seen the push toward the automated target recognition machines, the stick figure machines. i do think that we can force the agency to get into line, but it

will be with a lot of follow- through. i guess i still have faith in the democratic process. [laughter] >> we need litigation. it's good that that is happening. we need to appeal the progress more because they haven't taken up this issue the way they should. but ultimately, we don't get rights by appealing to somebody else. we have rights and we retain our rights by exercising them. really to get these things established is for people to say no to illegal orders, illegal demands. if you're prepared to do that, take the rap and fight it. unless people stand up and say no, this will move forward. >> yes, you have to pick up the dust. sending your angry comments. >> when we have the government recognizing a right to travel -- and i phrase that line in light

of the comments to the effect that we have them, but the government just doesn't recognize and ask when we have the government recognizing a right to travel, it will be in no small part due to judgment call and edward hasbrouck. -- due to ginger mccall and edward hasbrouck. [applause] an administrative note. we will have lunch on the second floor. one floor up from here in the back of the building. inc. you. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2013] >> some news to pass on to you this afternoon. republican u.s. senator mark kirk of illinois says he supports and sex marriage. that same-sex couples

should have the right to civil marriage. senator kirk has recovered from a stroke and is the top republican from illinois. our korea says it is restarting a plutonium reactor and is increasing production of nuclear reaction material. secretary of state john kerry's meeting today here in washington with south korea's foreign affairs minister. they plan to speak to reporters this afternoon. we will have live coverage of that beginning at 4:20 p.m. eastern. former treasury secretary hank paulson speaking this afternoon on china. he specialized on china i'll head of the organization goldman sachs and visited china as treasury secretary. he will be a george washington university to talk about the chinese government policies on the economy and the environment. c-span2 will have live coverage.

it begins at 4:30 p.m. eastern. we have to take back media. independent media is what will save us. the media are the most powerful institutions on earth. more powerful than any bond. more powerful than any missile. it is an idea that explodes onto the scene. but it doesn't happen when it is contained by that box, that tv screen that we all gaze at for so many hours a week. we need to be able to hear people speaking for themselves outside the box. we can't afford the status quo anymore. from global warming to global taking. >> amy goodman your calls, e-mail, facebook comments and tweets "in depth" three hours live on sunday on c-

span2. , "in their documentary poverty, america's untold crisis," frank bouton and jason economic impact on the u.s.. >> frequently called the most cosmopolitan city of the midwest, detroit today stands at the threshold of a bright new future, one rich with the promise of fulfillment. . since then,965 things have drastically changed. detroit's once positive outlook has been crushed by economic collapse. city is facinge numerous complications, touch as inadequate education, high crime rate, and high implement.

it affects detroit and america as a whole. it is also the issue that is most often ignored -- poverty. >> we had an infrastructure that look like a diamond. now it looks more like a pyramid. >> the poor is getting poor. sooner or later, the request will not exist. >> properties the new american norm. >> that is 50 million people living in substandard conditions. the nation is facing its highest level of poverty since 1983. how can the obama administration save america from this untold crisis? >> poverty. >> poverty. >> poverty. >> we hear this word all the time. but what does it really mean?> there are many ways to approach property. we need to look at its implications for people and society. in the ms. general sense, it is when an individual is unable to procure life necessities. toit is not being able

provide for your basic needs, such as housing, food, warmth if you live in cold climates, those kinds of things come even feed yourself. >> people experiencing poverty tend to face convocations, homelessness, health problems, and the lack of hope among others. while many consider these to be serious issues, it does come in varying degrees. as america standard of living is rising, many luxuries are becoming necessities. >> cell phones. francis, let's take cell phones did they used to be thought of as such a luxury. now they are a necessity. if you have to call on a job, you need that cell phone. if you have to call to make a doctors appointment, you need that cell phone. >> it has major implications for society as well. those who are poor are often unable to contribute and must

rely on others to support them. >> the entire society suffers. people that are poor and not producing effect the entire societal economics eight. >> -- economic state. >> rather than legitimate sources of income, they are looking for other forms of income. >> in fact, the property crime rate rose 11% from 2010 to 2011 and the crime rate is the highest it has been in decades. an effect on the morale of the country. this is the generation that will not do as good. >> if we want our nation to progress, the first at this controlling poverty. statistically, the official poverty measure comes from the u.s. census euro. this measure, based on -- census bureau.

this measure, based on the process of the 1960s, is far from perfect. it has some real problems. >> it fails to account for factors, such as taxes, in-kind benefits, and other living expenses. fortunately, there are alternative measures. it takes into account all of the measures and takes a realistic look at the situation. the sad truth is that poverty is higher than expected. 61% in 2011. >> the poverty that happens when major life things happen. it's a you get a divorce or you have a major medical issue that are you could not work for a while, things that send people in time into poverty. but then

you have chronic poverty. when you graduate for high school, you won't get a job that will pay decently. or you graduate, but you don't have an skills. isthe face of party multifaceted. there is more than one answer to our nation's questions. >> the problems of party can be easy to fix. while the private sector deftly contributes to the social safety net, government intervention is what really makes a defense in the short run. ask -- makes a difference in the short run. >> many people lost their jobs. >> food stamps and medicaid can help people overcome the ups and the road. they can help them -- the bumps in the road could a can help them get back on track. >> whether the government hands out without expecting the

receiver to do anything, that is not good for the government nor for the individual. the reason is for the dependency on the poverty individual. >> from a monetary standpoint, welfare has been severely inefficient. over $15 trillion have been spent as the great society and that has resulted in a jumbled change in the property rate. poore benefits to the have increased by 375%. we are not hitting any bang for forwelfare book, are we -- our world fai -- for our welfare buck, are we? >> long-term poverty is more deeply rooted in those suffering from chronic poverty are in a vicious cycle. all of us are passing a silent message of lessons down to our kids. executed fixing the issues

fixing education, to secure the nation's future and empower the x generation. >> the graduation rate in the poverty community is [indiscernible] >> but i am convinced, with the right education and new tools that can aid the people in poverty, they can start to get themselves out here >> america -- to get themselves out. >> making sure you get that kind of education and take all of us working and all of us working hand in hand. >> dear mr. president, [indiscernible] lead the nation done a certain path. since then, america has transformed from the land of opportunity and prosperity to a land plague of poverty. regardless of how we got here, the fact remains good poverty is a real factor in america. we are deeply aware of the issues that impact our surrounding communities and living in metro detroit has

exposed us to the tragedy of poverty. in your upcoming term, we ask you to focus more on this issue. thousands of people -- now is when people need you the most. while america's going through tough times, the power is in your hands, mr. president, and only time will tell what you will do with it. sincerely, too concerned american citizens. >> you can find -- two concerned american citizens. >> can find this video at studentcam.org. administration negotiator will be joined by a former european union to go shader on iran. this is about 90 minutes. >> thank you very much for inviting me to participate in this debate. as has been said, i was in

charge of the negotiation for a long time in 2009 from 2003. i was the first visitor to tehran at that time. i have 2010 to today, been less in charge. but i follow very loosely and i maintain some of the lines of communication with tehran. i don't have any responsibility from there on. let me remind you have some of the started. it's important to have a perspective on how the whole process has gone, what to my mind has been the most and then iovement, will say how i feel the next steps to my mind could be taken in order [indiscernible]

2003 was the first time that three persons from the european union went to tehran. it was important that we sign the tehran agreement that it had [indiscernible] wouldwould stop -- tehran wep their capability and would give them the facilities for the whatever they wanted in peaceful use of energy. was also to sign something very important.

that went for a year. everything went ok. but then at the general elections, there was little change. they denounce the tehran agreement. at the end.signed some time, a couple of years, a year and a half. supreme leader appointed somebody with whom we did most of the negotiations. the actual president of the parliament of around. this is somebody that you can talk to him well. you can engage. for me, it was the difficult part of the negotiation.

but to a certain extent, irrational part of the negotiation. , imake a long story short will tell you that it started -- the most important significant thing. the other was self-interest. you have to find an agreement between dignity and self- interest. you listen to them over and over again. there are two concepts.

today, they are accepting something again. them our't give dignity, they will be ready to accept. keep that in mind because we will come again to talk about that. ,he two most important moments when we offer a new proposal, which is freeze for free. you stop at the level you have at the day of the agreement and we will not take the sanctions out, but maintain the same level of sanctions. that was an interesting proposal understood in the beginning. but in the end, as you know, it failed. the didn't want to take position of stopping the

assembly of the centrifuge. they were not ready to give up any rights. and weinued with that centered in tehran a freeze program and together with [indiscernible] washe most important thing that it was signed by everybody. for the first time, it was signed by condoleezza rice did the minister from -- condoleezza rice. that was a shock for them, that the americans got into the picture with a six-run -- with a signature of these church state. as you know, that was a failure. putin saw thento

proposal. and you know it was not only a failure of the proposal, but of the negotiator who was ousted from his position. so a pretty bad moment. thathen the negotiator does not have to mind the capacity of [indiscernible] he is somebody who tells you what he received that morning before he goes to the meeting, but does not have the flexibility of going into a real negotiation. .here we went intelligent neva 2009 was a very good meeting.

that was a very good meeting. it provided for a bilateral and we that was a bad .hought we had agreed on 20% take it out and enrich it outside the country. today, we have much more .nformation about that to it was a failure. but since then, i have seen the closer possibility of an agreement. there was a sentiment that that was possible it we agreed formally that a referendum for

48 hours. in 48 hours, the whole thing was broken. again, there was a moment when we were close. let me tell you the problems i see in front of us and i see several problems. we have elections in tehran before the summer. getill be the focal to something going before those presidential elections. there is pressure from israel. i am not exec assure the agreement -- i'm not exactly sure of the agreement between netanyahu and president obama. the second big problem we have syria.iou

so they really have an intense relationship. it will be very difficult to get a negotiation movement. -- syria is arial so wemportant move very have a pretty bad situation. the we have in front of us other thing that i would like to mention -- sanctions.

sanctions have to be reviewed before the end of the summer. today, we have been able to put tough sanctions on iran. the levelll maintain that is supportable. the production of acrylic cysts are there. but imagine for a moment the economy goes in the but better -- my the global economy, the economy goes a little bit ander, the global economy, if the economy grows globally, it will be very difficult to stop the most important thing, that iran does not export any oil if they want to make

effective sanctions. that comes to china. if china continues to agree not to buy oil and gas from iran. so we have a competent a picture in front of us. i think the arabians are really can -- the iranians are really concerned and will not go against their self-interest as they keepy goes good saying the same -- we don't want to be a nuclear power. we want to be recognized as a regional power. that theys the line continue to say whenever you meet with them. i will stop here. we have many more things to say.

but there are many more things from the white house that i cannot speak about two [laughter] >> thank you. i think he has done a very good job at describing the ups and downs, the frustrations and the difficulties of trying to negotiate a nuclear deal with myn over the past decade. expectation is that those ups and downs and difficulties and frustrations will continue for the foreseeable future. why? first of all, there is a fundamental difference among the parties on what the objective of these negotiations are. from the standpoint of the united states, working through the p5 plus one, we are trying to limit iran's capacity to produce nuclear weapons by physically limiting their ability to produce missile materials and by increasing means of monitoring their nuclear program so that we can detect future efforts to cheat and build secure facilities.

that's our objective. from iran's standpoint, the objective is the opposite if they want to create the capacity to create nuclear weapons, which means an unrestricted program .or enriched uranium whatever is required by the mpp. very different views and national interest on what we are trench which he gave secondly, the fundamental disconnect in terms of what i would call the legal framework that the p5 plus one and i run -- and iran approach these negotiations. the p5 plus one wants karen to demonstrate that the program is peaceful by complying with the various security council resolutions that call on iran to do certain things, including suspension on some parts of their nuclear program, cooperate with the iaea and so forth. from iran's soup -- iran's

standpoint, these acts are not considered legitimate. from iran's standpoint, they are not required to comply with any of these resolutions. they should be treated like any other mpp party in terms of enjoying an extensive civil nuclear program under iaea sanction guidelines. from a legal perspective, they are approaching this negotiation from different standpoint. even the fundamental differences, the theory of the p5 plus one has been to try to at least get agreement on some modest measures that would limit in someuclear program ways in exchange for limiting sanctions good and the hope that that would create confidence and create a context that would make it possible to try to negotiate

a more competence of agreement. at the same time slow down the nuclear program. but even in this very modest area, the two sides are very far apart in terms of the quid pro quo. both sides except the basic concept we're talking about, limits on the nuclear program in exchange for limits on sanctions. but when you get down to the details, they are very far apart and the p5 plus one are asking for pretty substantial actions on the part of iran in terms of limiting their new leader program, shutting down -- shifting down a lot of the 20% stockpile that iran currently , in exchange for some modest or concrete sanctions relief in exchange, the rainy and start demanding total lifting of all sanctions in exchange for stopping production of 20%, something that they could reverse overnight. of the quid pro

quo for a sort of modest step them there is a long way to go before the two sides could come to an agreement. i don't expect there to be an agreement before the presidential elections in june. both sides have an interesting in keeping this process alive so i spent the talks to continue hearing and there may be some incremental progress in terms of the slight narrowing of these big offenses among the parties. but i don't think it will come to an agreement. at the same time, even if there isn't a formal ale, i do think the arabians are exercising -- a formal deal, i do think think thei do iranians are exercising some discretion. don't want to have to deal with a foreign policy crisis. the iranians are deliberately converting enough of the 20% enriched uranium to oxides form

in order to stay below the red line that prime minister netanyahu to do decide last september at the un. for the time being, it looks like he iranians are deliberately slowing down those parts of the program that they fear could trigger either more sanctions or even a military strike. that may change after the presidential elections. that for now, there seems to be some limits on the program. for the future, the most important question is whether or not it's awesome book to increase the current level of sanctions by cutting even further the market that iran enjoys in terms of its oil experts -- oil exports. that is a real question. till now, the sanctions have been remarkably successful in terms of limiting iran's oil exports because there have been alternative sources of oil.

so iran's main customers, china come in yet, japan, korea have , japan,china, india korea have been willing to cut back. people depend on a global balance of supply and demand for oil. activity, on economic whether there is an economic recovery and what impact that has on oil. but that question of iran's oil is, that is the greatest concern. and if it's possible for additional cuts to be made, it makes it much more likely that they will be at least an interim agreement that would limit further sanctions in exchange for some limits on the nuclear program and potentially create a basis for trying to negotiate a competence of agreement, even if that negotiation fails. it would still create some breathing room in terms of limiting the program and slowing down the nuclear clock and

making a military attack list necessary. >> thank you. let me pose a question to both of you. youe have been times -- referred to 2009 were the iranians and agreed to a sickly -- to basically transfer out there stockpile or reduced to 20% in return for getting feel for their research reactor. but the iranians walked back from that deal in a couple of days. it appears that in tehran there are ways to deal with this negotiation. >> in 2009, it was discovered

-- uranium they had not declared to the agency. we had information about that before september. but it was made public in the midst of the general assembly of 2009. that was a big shock for her ran. it was discovered that i they hd another facility that had in then declared. some were frustrated with that discovery. the second thing is that, for the first time obama was in power and for the the united states allowed an american to be at the table.

as i said before, it was bill burns. to be at theor him bilateral talks in geneva. the climate was very good and we agreed on something very important for iran. iran, at that time, was running out of fuel at 20% to put it into the reactor, which creates isotopes for medicine. argentina had been the country that was footing the different enriched uranium in the reactor to produce isotopes. that was a difficult moment. get out the same amount that we put in.

so there were two elements that facilitate the relations. we had a good meeting. we sent an agreement that wouldn't contradict each other. it was perfectly done. that we i thought celebrate really. gary knows what happened the day after. there was a battle inside to run to the supreme leader in the end did not accept the deal. and that was the end. for me, that was the end area i have maintained some talks. love the yanni is now running for president.

he is an important figure. but see how he behaves if he is elected president. at the end of the day, the supreme leader is the one who has -- one of the big problems .s who's the interlocutor ver so this is an added application in the negotiations to my mind. >> i agree with that. the decision-making process inside tehran is buried skier. i think it probably makes it much more complicated in terms of trying to reach an agreement, especially because the political competition among the various figures in iran becomes intertwined with the nuclear

negotiations. for the 2009 at the so, that was a good example where buck mckeon agendas and clear -- was clear in favor of the deal that that was a good example where after -- where ahmadad dinijad was in favor of the deal. but it demonstrated how difficult it would be to get even a very modest agreement could this would have been an extremely modest agreement. and shifted the president's policy to one that emphasized increasing pressure in a way to gain leverage. a very embarked on difficult six-month negotiation for another un security council resolution.

at the very last moment, as most of you will remember, brazil and turkey and iran announced an agreement which was viewed in the white house really is a pretty transparent effort to try to delay the sanctions. so we went ahead with the sanctions. since then, we and the iranians have been locked in this sort of spiral where we keep increasing sanctions as the negotiations make a process -- no progress. i keep going ahead with their nuclear program and each side keeps trying to bargain leverage. kind ofnot reached some an agreement that would relax sanctions and the nuclear activities, where that is possible. >> please wait for a microphone to arrive and then state your name and affiliation. start right here.

>> miami washington correspondent for south korea's news agency. -- i am a washington correspondent for south korea's news agency. today, "the washington post" reporting, what is your assessment of the problem? let me ask you about the north korea nuclear tests last month. is a raise questions over whether the ternium or uranium- based nuclear tests, what is your opinion? thank you. >> as to what kind of material was used in the test, we don't know the test didn't say. there's no no way to measure whether it was plutonium or highly enriched uranium.

in terms of nuclear ties between iran and north korea, i am not aware of any. but it is something we have to be concerned are up because we know there is an extensive cooperation in the missile area. we imagine that north korea could provide assistance to ian in terms of enrichment. think the north koreans are substantially more advanced than the iranians in the subterfuge technologies. i think that we need to keep a close eye on it and north korea in the past has been willing in the past to sell materials, such as the reactor they were selling -- the reactor they were building in seriousy howard lind, private citizen. what is the rationale for threatening war in order to perpetuate the israeli monopoly

on nuclear weapons in the middle east, and why is and nuclear weapon-free middle east not part of the discussion? >> it has been part of discussions. remember 2009, the general clear it wasmade the first time the prime -- in one of the agreements is to try to work to get the years possibility of beginning the discussion about free trade zone in the middle east. the secretary general had to appoint someone but it has not taken place.

it was 2009, a moment in which the direction started. it did not take place for lack of agreement. i never would have imagined that would have been in 2009, but it was. president obama put it on the table in the general assembly. it was a meeting at the highest level of the treaty. add i think president obama has explained in speeches and interviews -- in speeches and interview why he thinks a nuclear armed iran would lead to proliferation in the region. the risk that it would threaten

and others.israel a risk that they might on purpose or inadvertently provide weapons to terrorists. and i think the president has in his mind a very clear basis on which to say that he will use any means necessary, including military force to stop them from having nuclear weapons. the fact that israel has nuclear weapons is really a separate issue. try tos a process to achieve progress towards a nuclear weapons-free zone in the middle east. that obviously will not bear fruit any time soon, especially given circumstances in the region. all circumstances support a nuclear-free zone, but the question is what kind of conditions will be necessary before we put that in place.

the conditions are not right for that right now. -- clearly the conditions are not right for that right now. good to see both of you back. the use think as long as we're talking to the iran and we will not be bombing them? the virus that is the new york times to be believed, the obama administration inherited from the bush administration. was it a legitimate use of force? thank you. a very difficult question. virus, i think the most important mistake was to recognize that who had done it. i think for a long time it was there and no one knew who was

the father or mother of the virus. that goes to the heart of your question. if you are the first one who put arevirus in cyberspace, you lost completely. you have sent an attack are ready. i think it is a mistake to do it. the second thing i would like to ,ay, and i am convinced of this i think the level of consistency and coherence is a diminishing. first becauseing of syria. remember syria, china, and

russia are not in the same place .f americans and europeans that is an important issue. it is not a minor issue because iran has an important relationship. if we're not together, it will be more difficult. now, i am very concerned that as there is less .oncerted action i was surprised the other day in the level of the statement. i thought one was to play. thought international affairs was very clear of the estate.

that in the last question. the question of the level of energy in the markets will be very important. in 2014to open up according to the latest estimates i have seen in order to see production to be maintained at 4% of total production. if the global economy grows a bit, the level of cuts to down,in the level of iran it would be very difficult to maintain. of therue that part equilibrium is being maintained by shady past. but if the economy grows, there is a point in which prices may go very -- that is something

that nobody wants. will have to stop the volumes of imports and they are doing from iran. >> i would say the primary factor that determines whether a military force is used is not what is happening around the diplomatic table, but what is happening on the ground. you can imagine the situation where the diplomacy continues without making progress. but the iranians are cautious to avoid taking actions that might trigger a military strike. i think that is the situation we are in now. the question is whether the supreme leader continues to exercise cautious -- caution and whether or not he accurately anticipate what kind of actions might trigger a strike. will say that i think this is a game where very high national security stakes are at play.

both sides are using all the levers of power they have available to them to a try -- to try to achieve interest. >> let me follow up on the first question about negotiation and military action. one of the concerns is iran has dried up the talks but have capability where they could very quickly deploy a nuclear capability. is there some sort of thing you would want to see coming out of the negotiations this weekend that may be a signal that there is a decision on the part of tehran to find a solution? what would be the man of the coin from the discussions that would say maybe there is indication that iran wants to find a solution? >> i have such low expectations from the next round of talks

that i think it is a mistake to try to set the bar. if they agree to another round of meetings, that will be the process continuing. i think it really is unrealistic to expect that there be some kind of breakthrough in peace talks. sides are using diplomacy for their own purpose. they lose -- use this to show there is diplomacy. to the extent there looks like progress, it helps maintain the value of the currency. use this to show it had been in trenton and therefore more sanctions are required. that process will continue. at some point it the next round of talks did not achieve results, the -- the u.s. and eu will look for additional sanctions to increase pressure.

>> michael gordon, new york times. you mentioned the restraint. can you address the new centrifuges they are also produced -- pursuing, and what the strategic implications are for break up scenario in the military sense, and what policy changes they propose in the sense that can iran get to a place where they can take after -- take action much faster than and the international community can respond? ways they canwo produce highly-enriched uranium. one is to use a facility that under iaea inspection. that is where they would deny that inspectors aspect -- access or kick them out or as quickly as possible produce enough of a

highly-enriched uranium for nuclear device. right now there are probably a couple of months from being able to do that. as they increase capacity and put in more centrifuges and increased capacity like the new generation, they may be able to squeeze the break up time to a couple of weeks or even less. leastt case it does at theoretically possible they could produce enough highly- theched uranium before international community could act. i think they're still a couple of years away from having that kind of capacity, because they need more of these advanced centrifuges in order to do that. the other scenario that i think is much more plausible is what we call sneak out. once they have enough, they would be in a position to confront the world. we know that second approached

is one that iran favors. my guess is at some point in the future they will try to build another secret enrichment plant, because that apart from their standpoint poses a much fewer threats. using atry to break out facility under safeguard, they run the risk it would be detected and the u.s. or israel or others would act against it and destroyed the facility before it could produce enough weapons-grade uranium. the question that michael is raising is the right one, that if we continue for a couple of more years with this current pattern, they can get closer and closer to have an incredible break out capacity and will use that as a threat. they will threaten unless certain things are done, the sanction and that sanctions are lifted, they will be forced to take action. that will become a more credible

threat. i did not think there are there now. i think they are too far away from that to be a credible threat. this is not a simple thing to do. they did not have the 90% already achieved. [indiscernible] i agree with that. the only thing i would add is we probably have great capacity to weapons gradevent material as opposed to weapons grade inspections. not to say it is impossible, but

much more difficult. it can be done with fewer number of people and facilities that are easier to hide. >> if they want to go for a basic nuclear weapon. the weapon on hiroshima was never tested. if they want a more advanced weapon, then it is much more sophisticated question. it would probably be fair to say they want to test before they actually believe the capability existed. >> my sense is yes, they have to test. tests may be done through computers, etc., but i do not think they have capacity. a number of bombs. example we have is north korea and pakistan. they had to do the test. today with the level of capacity we have, i think that is

impossible not to be detected, to my mind. i think it is always impossible not to be detected. the capacity and the number who have this, it would be very not for the test -- for the test ought to be detected. >> this is another good example where they have imposed political restraints on the program. and they have a very comprehensive well-positioned program, which was detected and revealed, and they stopped it in 2003? at some point in the future i could easily imagine them starting the program again in hopes they would be able to achieve a lot of the preparation work necessary. i agree ultimately it is likely they would conduct a nuclear test in order to demonstrate they have a credible nuclear capacity.

>> brian berry. i am wondering with the heating up rhetoric in north korea and military maneuvers, what impact that will have on the nuclear talks? will the somehow supplement something out of it? north korea looks to be more of an urgent threat of the moment. could it have a positive affect? >> i do not think it has any impact at all. they are all capable of dealing with several different problems at the same time. to some extent your career is a good example. to some extent, korea is a good example where there is pretty good cooperation, certainly among the u.s. and china and russia. all of us want to avoid a translates into greater cooperation on iran.

>> ok. >> edward levine, former senate staff member. if the supreme leader is the key to getting iran to agree to, a sensible negotiations, and if he has a particular concern for a rimbaud's the dignity -- iran's dignity, what part has been given to enlisting help from some third party whose mere presence would of course some of that dignity to iran and also create a channel to the supreme leader? >> and has been tried with turkey.

turkey has been a country that has been tried with the p5-plus- 1. i have been talking to the turks a lot. as you know, the last time with brazil, all that was supposed to be -- we considered it to be a little bit of a ploy. turkey then separated very much from the negotiations. maybe now with the position they have taken with israel, maybe there's another moment turkey can be used. the supreme leader does not talk to leaders that he has not met with. he met with putin in 1997 when

he went to the supreme leader, he was received by the supreme leader. laranjani was there. putin could not convince the supreme leader. i cannot imagine other leaders that could have a good relationship with the supreme leader with the exception of muslim countries. turkey continues to been the most and hand. don't forget turkey is against the regime in syria. it is difficult to find the perfect interlocutor.

it's. been a long it's difficult to negotiate without bilateral talks. >> we cannot really psychoanalyze the supreme leader. dignity is less important in my view than he wants to have a nuclear weapons capacity. second, here and looks at the nuclear issue as part of a much broader struggle with the united states. he believes the united states is trying to destroy the islamic republic. we are using the nuclear issue in order to try to achieve that the political and economic pressure, he thinks. the supreme leader has obstructed the negotiations.

he has created a self- fulfillment processing, in my view. we are seeking economic sanctions which could potentially pose a threat to the survival of the regime, if there's enough public unhappiness with the economic damage that he has brought on his own country and through their mismanagement as well. with, lara jake's associated press. yuka spoken a lot this morning about the house syria and the p five negotiations are intertwined. i wonder what effect u.s. military intervention in syria might have on some of the negotiations, not only recognizing this would likely be seen as hostile by tehran but also the effect that it would amount to a proxy war with russia and the chinese would

likely follow the russian lead. if you could talk about that? >> i cannot speak with knowledge. i'm not in office. the only information i have is information that i have through friends which are engaged in this. i think that the united states has not taken a more active role in syria from the beginning because they did not want to disturb the possibility -- to give them the space to negotiate with tehran. they probably knew that getting very engaged even militarily could hurt potential negotiations with tehran. nowadays the situation is a little different, because the situation within syria is much worse than what it was at the beginning. i happened to meet yesterday by coincidence on the train coming from new york a person coming here. he was telling me the situation. he told me that he did not

[indiscernible]. he asked me directly if i had a very good network in the country. the situation i think is much worse. how big the push us to be done, how much of the ratchet. they justify for the excessive use on the trenches of the

villa, military action in libya. how many years, i do not know. russia we need to be much more engaged in order to resolve the question. that is a concern they have. i was in moscow a week before this one, and i met with putin. i see a sentiment that is not better. to some extent, korea is a good

russia. theear is they may get situation with iran and may break an agreement. it is a miracle really. the moment of sanctions we passed together, which was very difficult. very, very difficult, but i do the level of construction -- constructive work together i think is diminishing. >> i would say you can argue it either way, but the collapse of assad makes a nuclear deal more likely, because that makes the supreme leader more likely to make tactical some concessions in order to relieve further isolation. his will not change

fundamental interest in acquiring a nuclear weapons capability. it will confirm for him that the best way to defend himself against the united states is to have that capacity. in terms of near term tactical decisions, the more he feels isolated and threatened, the more likely it is he will make modest concessions to have some interim agreement. >> how serious do you take the anti-missile fatwa by khamenei? >> i do not know much about shia theology, but it would useful basis on which it the supreme leader and the

iranian government could justify some limits on the program. i think we would -- we would welcome, if the iranians want to construct a theory for why they are accepting limits on the program because the supreme -- my impression is it can be changed pretty easily. >> thank you very much. i want to pose a question to

both the ambassador and dr. samore, and the question in which two distinct observations were made. the first is that the interests of the supreme leader is not dignity, but that he believes iran should have the bomb. the second is the bomb question as only one piece of the frame and relationship with the united states, which is that what we are really after is a change. given those two factors, if one accepts them, and for what it is worth, i do, what possible factors lie out of there? the ambassador said that the road to tehran may run through damascus. there is the presidential election, there is the prospect at some point khamenei does not

live forever. what keeps us in the game, and why is it that president obama continues to make statements that appeared to be indefensible about we will do whatever it takes to prevent iran from having a bomb? >> let me take a crack at that. what you said is exactly right. i think it is true the supreme leader wants to avoid going to war with the united states, because he knows he will lose

and that could lead to the end of the islamic republic. he has demonstrated caution in terms of limiting the nuclear program in order to avoid what he believes is a red line that could trigger a military attack. the value with everything we have done in terms of public pressure, sanctions, threats of war, all of that has helped to reinforce his caution and has led to constraints, has led -- and the iranians could be moving much more -- moving forward much more quickly, but they have self-imposed constraints in order to avoid those risks. whatever happens at the diplomatic table, we have an interest to make clear that we would not accept iran having nuclear weapons and we are prepared to use military force, if necessary, and we will increase economic and political pressure. that has a positive impact. >> a contradiction which i think is the legitimacy of action is going high.

it is difficult to imagine after syria, etc., and after history how a military action could have legitimacy. how is illegitimacy found? well, we have to find the legitimacy in the security council. we do not have the p5 together, it will be quite difficult to do it, and i would say difficult to have international community together. it is not a trivial thing. what we're talking about, after the advent of libya, syria, and we found it difficult the security council resolution, maintaining the international community coming together. i think we have a lot of problems. we have another problem that we have not mentioned.

suppose that we get an agreement, and that agreement will have to lift sanctions, rapidly. you have the congress of the united states that has to do it. task,s not an easy either. and that is known by the supreme leader, also. so we have some other problems that have to be considered that makes the problem. delicate and difficult. >> hi. you mentioned earlier both the possibilities on the other side

of the iranian election in june, that they will have greater flexibility for dialogue as well as lifting off the brakes been putting on, 20% enriched uranium, as well as other activities. i wonder whether you see an outcome of escalation or the escalation been more likely and what factors you see playing into that most. i would be interested in the ambassador's take as well. thank you. >> either is possible. one could imagine the leader feeling more confident if the shores up his domestic situation, manages the elections, makes sure that ahmadinejad's candidate is not elected and he has somebody in the presidency who is compliant leader might feel he is in a stronger position to take to next level, whether it is

20%, higher levels of enrichment for their naval reactor program. one could imagine later this year there would be a confrontation. one could imagine he is in a stronger position, he actually has greater flexibility to make some tactical deal with the p5 plus 1 to relieve pressure. i do not know which way it will go, but as long as it is more likely to get a positive outcome if he believes there's more sanctions to come. if the leader believes the p5 plus 1 is reached the limit, then he will feel he can weather the storm and does not need to make concessions. >> i tend to agree with that. >> thank you.

the national defense university. the two sides claim time is on your their side. what is your assessment? if we ever reach a deal with iran we have to sell in washington, and given the relationship with iran for 30 years, it would be hard. i imagine the president will have to ok it by the public and the congress. how do you think we can sell a deal domestically here? thank you? >> you have to sell any agreement on its merits. if that achieves its intended results, then you have a strong basis on which to convince congress and the public that it

is worth supporting. if the deal does not have a dramatic impact, if it is just cosmetic and allows the to continue on their course of expanding the capacity to produce this material, the deal will not be supported. we have to keep in mind any agreement reached will be subject to strict monitoring. iran has demonstrated it is not shy about cheating on its international obligations, and it has a very long record of violating the safeguards agreements it has reached. one could imagine a situation where there was an agreement and some ways down the road it was revealed iran was violating it. >> then we would have to convince all the parties. saudi arabia would have to be convinced, and others. you understand what i mean. >> can you expand on the nuclear collaboration between iran and russia, and are they legal under the mpt?

>> yes, the cooperation between russia and iran is legal. we accept it, that the enrichment of uranium, for a nuclear reactor, but the of that is produced in the reactor was taken by russia. russia was conscious of the movement of the reactor, and that was accepted and encouraged to finish it and encouraged to put fuel in it.

in my mind, yes. >> there have been instances where russian scientists have provided unauthorized nuclear assistance to iran, and president bush confronted president putin with the fact that a russian institute was helping with the heavy-water research reactor that was being built in iraq, and the government stopped that. there is a good record of the russian government limiting nuclear cooperation with iran reactor, which we have accepted. athi, i'm a law student american university.

i have a question about why the military strike is even on the table, because haven't we learned our lessons from iraq? we have killed so many people, we have harmed our military, we have harmed our economy. why would we consider doing that with iran? as a business owner, why can't i buy oil from iran? the oil crisis, we were at 99 cents a gallon in 2001, and now we are $4. if we go to war with iran it will be eight bucks. why are we hurting our american economic interests to prevent somebody from pursuing their national defense strategies like any other country does? >> i see it as a clash of interests. havingnians think nuclear weapons or the capacity to produce nuclear weapons is necessary for their defense and

to assert their position in the region. the u.s. for reasons that are produced understandable from our standpoint, we want to stop iran from having nuclear weapons because it would be threat to our interests and those of reference of the region. there's a clash of interests. i'm not saying anybody is right or wrong, but in international politics and if you have a of interests and you cannot reconcile them, then the ultimate recourse is the use of force. clearly, obama is not looking for opportunities to attack iran. he has made the case that we're not at that point where we have to make that choice, that there is still room for diplomacy, sanctions and pressure, still some possibility that that will achieve results. at the end of the day, he says the matter is so important to the united states that he would be willing to use force if necessary. people may disagree with that judgment, but that is the

judgment that he has made and explained publicly. >> my question is for gary. do you think the u.s. is prepared to acknowledge iran's right to enrich at some levels, 5%, at some point? that you had an agreement satisfied our goal of limiting iran's capacity, ability to produce nuclear weapons, i think some limited enrichment as part of satisfying iran's dignity, some face-saving outcome should be acceptable to us. i do not see any evidence that iran is prepared to accept the kind of limited enrichment that we would really require in order to achieve the results of

physically limiting what they are capable of doing. >> allow me to say, i do not think it is imaginable in an agreement with the recognition of enrichment by iran. that is the trick, how that is worked. i cannot imagine after having spent hours, cannot accept anything that takes the program to be disassembled. >> one of the complications of this negotiation is the iranians are insisting they're right to enrichment be recognized by the p5 plus 1, if they have not acknowledged that obligations imposed by the

security council and the iaea to demonstrate that their actions are peaceful. it is hard to imagine a deal where we accept their principle they did not accept ours. if we had a mutual acceptance where we're prepared to acknowledge once confidence is assured, they could pursue enrichment, but one would expect in return they would acknowledge that they are obligated by the security actions, which includes a suspension of their enrichment program until confidence is restored.

>> i am from iraq. my question is about the negotiations and the details. were there other topics other than the nuclear program that iran talked about, like iran's destabilizing role in the middle east in supporting terrorist groups in iraq, lebanon? and other issues internally for iran, like its horrible human rights violations and democracy? >> in negotiations, it was first and negotiation with iran and then the possibility we get engaged with this negotiation had them. there are many other topics that we would like to talk to them. remember that iran was at the table in the agreements in afghanistan, in those negotiations, that iran was at the table.

at a given moment, the bush administration was thinking about putting on afghanistan negotiations, but nothing having created the climate, appropriate on the nuclear issue, and other potential topics. >> the p5 plus 1 talks were created to address the nuclear issue. that was the primary focus in terms of what they would like the agenda to focus on. it is true the iranians have said we want at a much broader discussion, talk about syria, bahrain, and that has been resisted by the p5 plus 1 because we do not want to anxiety on the part of other countries in the region that we are negotiating some kind of regional arrangements with iranians when they are not

present at the table to have their interests represented. >> we have five minutes left and we have way more hands. i'm going to take three more questions, and then we will answer those. >> as we approach the end, this has been interesting. i would like to move for a second to the framework of perceptions. the president's statements have led to a perception that this year or next year are critical years, that if we do not solve the nuclear issue in iran that we will be moving toward a conflict, and we seem to be discussing this with the

israelis, although in the last meetings, netanyahu moved back from that. on the other hand, as this discussion brought out, the weaponization has a long ways to go, and true weaponization thet not at all occur in presidency of president obama. are we running a risk here of perhaps being too smart by half and that we are creating the perception of imminent danger and conflict and decisions that, whereas in fact, weaponization is not progressing as far as we know, and if it did it would take some time. we're talking about something beyond the next three years. >> second row here. >> i was born in tehran.

foresent global bridges humanity. it seems that for many years america has been engaged in persuading iran to come in line to the line that america thinks is right for iran. and we have up to this point seen that, as they say, it is very hard not to -- iran needs are not that hard to be pushed over, but the fine line was to give us that 20%, and we will tell you when you can get it back. that was not acceptable to them. when you are negotiating you have to have some kind of principles to follow.

we have come to a point that to recognize that iran may be a regional power. why don't we get iran and see what our interests are in the area, and see if iran can protect our interests in that area they are capable and they will not cost us anything? they will be more than happy to do and protect our interests without money to give them like we do to other people in those areas. the question, after all these discussions, when it goes beyond a certain point, it shows the impotence of america in solving a problem that is very important to the world. >> last question, over here. >> gary and ambassador, is any price that you think plus 1 would be willing

to pay that iran would accept the 20% for a small deal, and if i'm interested in, gary, you think about the big idea or offering them a more comprehensive offer. thanks. >> let me take this hit on the timetable, as i tried to explain, the timetable is determined by political decisions and calculations, not by physics. thate leader does things brings this matter to a head this year, and there are lots of things he could do that could force president obama's hand, then we may be facing in military conflict in the near future. on the other hand, the leader may avoid actions that would force the united states to act, in which case the diplomacy, the sanctions, nuclear creeping,

all this will continue for years. it remains to be seen. whether or not the next year it is critical or whether this problem will continue on its current pattern for the rest of the president's term. on the question of other issues, the u.s. and iran are loggerheads on almost every issue, syria, and i agree with mr. solano, that this has cast shadow with the negotiations, but whether it is a peace process, hezbollah, u.s. forces in the persian gulf, almost every issue, u.s. and iran are enemies, and that makes it much more difficult to deal with a new issue in isolation. finally, i think it is possible that iran could decide after the

presidential elections to the small deal that is on the table now. i think it is a good deal for iran, if they are looking for a way to create some respite from pressure, what an offer would do pick it might not lead to a deal, but the trouble, anything that we would accept in terms of what their program would look like, it is fundamentally unacceptable to the iranians because it would take away their weapons capability, and that is the whole purpose of the program. >> let me comment. the first thing i would like to say is the level of mistrust between the united states and the western world and iran is very difficult to convey. you cannot imagine the level of

mistrust. second, the war between iraq and iran has not been forgotten in iran. we were playing the role of iraq at the time, and that is -- the second negotiation was lost. keep in mind, this is a very difficult situation. number two, in the most candid moment in the negotiations that they have, and the moment when you're walking with no interpreter, they might ask, what would be your dream?

could you tell me what would you want to obtain? and i think, not a complete answer, but an important direction, of what you want. we look very much to brazil. why? brazil is a regional power. it has a nuclear reactor, which is nuclear. but they have not produced anything. they have been allowed a certain capability which they have not used, etc., but they want to be a regional power in order to be a regional power recognized, they need to have some level -- you look at the world. you have japan, brazil,

argentina, and i would not stop. some are some others with capabilities. this is a question -- why would we not allow this to go this far? the answer is -- brazil was always in the commentary, brazil was a good model. i do not know if that answers that for you. a regional power, with the recognition that they were class a, that you have a level of nuclear capability. >> [indiscernible]

>> i do not have anything else. it is want to be difficult, but i think it is doable. that is what i really think. >> will you please join me in thanking our guests. [captions copyright national cable satellite corp. 2013] [captioning performed by national captioning institute] >> proponents and opponents of gun-control laws held briefings today. both of those available online at c-span.org. going to show you portions of those right now. an nra group released a report

saying all school should have armed guards and weapons training for select staff members. spoke onijah cummings bipartisan efforts for gun trafficking legislation. >> i have been asked apart from our gun trafficking bill whether i support the other gun-related legislation, and the answer is, i do. fixingmple, i believe the background check system is one of the most common sense actions we can take to prevent criminals from getting guns. i think that it would complement our gun trafficking legislation very well. background checks would prevent many criminals from obtaining guns and the anti-trafficking legislation would propose -- promote strong criminal crime -- penalties on those who try to get around the system. for myself, i have children to

focus primarily on it -- chosen to focus primarily on gun trafficking legislation because it is an issue i have been working on for several years. i have work painstakingly with both democrats and republicans to slowly build a bipartisan coalition behind this bill. i strongly believe when people understand what this bill does, they will support it wholeheartedly. in fact, even the nra has come around of the past several months. there are only two groups who should oppose this bill. let me say that again. only two groups that should oppose this bill. criminals and people who want to buy guns for criminals. congress can pass fire arms trafficking legislation and universal background checks, we will have made real, substantive reform that will help to reduce

gun violence across our great nation. a modelve presented training program for school resource officers that is an enhancement of what they currently undertake and are required. hours40-50 hours -- 40-60 a comprehensive training for the school resource officers. that covers everything from weapons retention to coordination with local law enforcement, and that is in the presentation. we also have prepared, for the first time that i am aware of, a model training program for selected and designated arms for school personnel. this is probably the one item that catches everyone's attention. why are -- is this part of our recommendations that we have this model training program? first of all, there is the

incident in perl high school in 1997. a shooter went into the school and killed two students and wounded others. there was no school resource officer. the assistant principal left of the school and went out his truck and retrieved his 45 caliber semi automatic firearm and disarm the assailant. that is an example of where their response is critical. that is what disarmed the assailant can save lives. the key is reducing that response time. if he had been trained, if he person, heon his might have saved more lives, even in that instance. -- theree findings was one school that did not have

officers and they were already planning to harm staff. for the protection of the kids. whenever the inquiry was made and said what kind of training do you have, it was insufficient. schools are undergoing that process all across america right now without adequate direction on what is a good program, a model training program for armed personnel. that may emphasize this is not talking about all teachers. teachers should teach. if there is a personnel that has someone that is willing to go through this training of 40- that is an appropriate resource a school should be able to utilize. the second recommendation is laws thatave to adopt allow the firearm to be carried

by school personnel when they go through this model training program. state law that could be considered for this purpose by the various states. see the entire briefing from today followed by congressman coming starting tonight at 8:00 eastern on c- span. john kerry is meeting today in washington with south korea's foreign affairs minister about u.s.-korean relations. plan to speak to reporters this afternoon after the meeting. we will have cover starting at 4:20 eastern. also hank paulson is speaking .his afternoon on china he visited there as treasury

secretary. he will be at george washington university to talk about policies on the economy and the marmon. c-span 2 will have covered beginning at 4:30. take back media. independent media will save us. the media are the most powerful institutions on earth, more powerful than any bomb, more powerful than any missile. it is an idea that explodes onto the scene. but it does not happen when it is contained by that box, the tv screen we all days at for so many hours a week. so many people are weak. we need to hear people speaking for themselves outside of the box. we cannot afford the status quo anymore. from global warming to global warming. >> author and host amy goodman

aching your calls and tweets -- taking your calls and tweets on book tv on c-span 2. treasury official airing .- aaron klein >> ok, we are going to get started.good afternoon. it is a privilege for us, in cooperation, to host this series. i am the director for the center of policy. it is really a privilege to host

this series, and i am glad that all of you are here to hear our featured guest today. i do not know where michelle is. she is involved in the logistics of this event. ok, she is not here. but i wanted to give you a brief michelle is back. she has been responsible for the logistics of this event, and she has been impeccable. the center came into existence in the wake of recent events. we thought we should have a center that is engaged in the

advancement of research and to inform financial policies. we launched it a couple of years ago, featuring a hotly debated topic. we are fortunate. a variety of activities, round tables, conferences, in partnership with a number of institutions, [indiscernible] berkeley, nyu, so on. but as a research arm. today's briefing is an example.

is towe do in the series bring in staffers to come to campus to talk to the students on issues of current interest. we keep abreast of the latest developments. i want to point out this is not the first time the center has interacted with the legislature. most of our events are in washington d.c. we're fortunate to have the senator and congressman to keynote at our signature events. one of which was a conference. phillip swagel will introduce.

before he does it, i want to april is fur events. ll. on april 15, we will be featuring a general manager as our distinguished , on er.then april 23, we will have another congressional speaker.both of these events are held in college park barracks also hold events in washington d.c.. we will have a big event on april 26. that will be a forum for emerging markets. we will be looking at opportunities by emerging markets, bringing together academia, diplomatic circles,

and a variety all around the globe. so we have a pretty heavy april coming up. i am going to end with that. then i will give speaking time to our partners in the school of public policy and the school of business at the university of the schools have partnered to feature this event. phillip swagel in particular has been our partner at the center. he will be making an

introduction of aaron klein. thank you. >> thank you. thank you to the center of financial policy for organizing the event. it is my pleasure to introduce my friend and colleague, aaron klein, the director of the regulatory reform initiative in washington, d.c. i am also involved in that initiative. before moving, he was the assistant secretary of the treasury department. there, he worked on a range of issues, including financial regulatory reform, the enactment of dodd-frank legislation. he worked on the implementation of the housing policy on transportation on infrastructure. he has a lot to account for. before his service, for eight years, he was at the senate

banking committee. ended up as the chief economist there. the first senator from the state of maryland. he is a graduate of dartmouth college. and princeton university's woodrow wilson school. he will explain he also has the connections here to the university of maryland. please give a warm welcome. [applause] >> thank you. thank you all of you for having me as indicated, i am currently the project director for the financial regulatory reform initiative and the by hals the-- at the bipartisan policy center. and we tried to bring democrats and republicans together having been the chief economist for

president obama, both phil and martin at the bipartisan policy center, we try to bring democrats and republicans together to solve and propose common-sense solutions to the problems that face our country. we are saying -- what is going well, what can we do better, and what was missed? dodd-frank was a sweeping change of our financial regulatory landscape in response to the single greatest financial crisis and panic of our lives to date. and hopefully for the rest of them. anybody who lived through that process should not want to repeat it. i thought i would talk about that.

i thought i would also try to frame context in my talk regarding this crisis and past crises i had while i served in the senate. namely the accounting crisis. we will talk about the role of congress and the legislative branch. and mostly in rap with you in here questions and thoughts on your end.feel free to stop me at some point, raise a question, asked for clarification. if you are thinking it and not asking, someone else is probably doing the same thing. before i do any of that, i want to say how grateful i am to be here. my mother is an alumnus. she earned her doctorate in french literature. i am a lifelong marylander. i did work for a professor who later served with me in the obama administration as director

of the census. i am thrilled to be here with john, who is a professor at the university of maryland and was a colleague of mine at the treasury department. the university of maryland's serves not only its campus, community, state, but also its go, terps. it is a privilege and honor to be here today to speak to all of you and to be back on campus in college park. to give you a little more context, i spent 8.5 years on the committee, starting as a professional staff economist and becoming chief economist for the senator, the longest serving senator for the great state of maryland during my tenure in the senate. then, after he left, i stayed on and was asked to stay on by the incoming chairman, senator chris dodd.

i had the great honor of serving as his economist through 2007 when he took over the committee, through 2009. then, in the beginning of 2009 with the incoming obama administration, i got a fantastic opportunity to go to the treasury department. in all my career, there is something special about serving your home state senator. i am in maryland. i served for a great senator from maryland. there is a value that everybody gets in their lives from giving back to their community, whether you define it as your state, your nation, your church, your community organization. how you do that, i would argue, do it as an integral process of your career, whether it is through your business, after

spending time in or out of government, government can always benefit from expertise from a wide variety. think about integrating that through your career. i will touch on how business interacts with the formation of policy, to improve it and in some cases maybe not so much. and during my time with the senator, we had a huge crisis in the region in america. it was a major crisis in which publicly traded companysies' numbers appeared to not be accurate. they had a domino effect. this sounds a lot like a financial crisis. if i said, lehman brothers, aig, that should sketch a familiar timeline. fannie mac.wamu.

the similar crisis timeline in 2002, enron, world calm, these major companies, many of whom declared bankruptcy, whose accounting numbers were not .ccurate.fannie, again major amounts of capital in the market moved toward these companies on the basis of numbers that were demonstrably false. there were major distortions. the next time you see the stock market from the year 2000, you will see to giant the spirit one -- two giant v's -- one is the accounting crisis in 2002.the dot com bursts, the market goes back up, and there is a huge fall.

although lows touched during the financial crisis or the lowest from the county crisis. what happened? business and industry and investors could not believe the rules of the road. they thought the rules -- they were not sure what the rules were anymore. they were not sure people were obeying. there was a major shock in the equity sector, of all companies, good books and that boats.-- and bad books. that was solved through a public response, commonly known. it was a really big deal. at the time, it was signed by president bush, called the most sweeping financial regulatory reform since the great depression. that was true at the time and also true for dodd-frank. but it did not create a structural recession. it did not create a recession at all. we were actually coming out of the recession in 2001. it did not reverberate through the broader economy the way the financial crisis did. why?

as much of a concern as you may have had on accounting, it caused people to entrench in the equity market and to you could fix the rules of accounting. when you have a financial crisis, it costs the market itself to cease to function. a very different space. it also has a ramification of a financial crisis in the debt market and the change of companies between each other to do maturity transformation of operating and capital expenses you do not see in terms of investing in firms from accounting perspectives. there was a bit of a this time is different mentality but there is a big difference between a financial crisis and its reverberations in the real economy, and an accounting crisis, or the dot come i.t. c risis,

the misallocation of equity capital, the inability of financial institutions to provide debt and liquidity into each other and companies in the broader market.i would flag that. in both cases, you saw a big, sweeping laws that had major ramifications. the timeframe was more narrow. the crisis was not as clear. when the senator became chairman, which party, i do not know your congressional history, but one senator from vermont switched five months into the democratsnistration. took over. we did a whole tenure for what his time and chairmanship would be in the next 18 months. you will never find a word accounting in there once, even though that was the one we had the most hearings and pass our--

passed ou r most edseping regulations.the se for what became the financial crisis were evident even then. anyone who says nobody saw the problem does not know their history. mortgages were being originated that later became the toxic assets. at the very early period in the origination process in 2002, the city of baltimore had them and -- earlier than other metropolitan areas, many were saying these would not work. the other folks said, you have to provide credit. it costs more. these are new and innovative products. homeownership is a good thing. so, it is not such a problem. as it turned out, the very

products misaligned incentives of lenders, are worse, and investors, to the point where they eventually affected the entire system and cause the entire financial system here and globally to go on to the press-- precipice of collapse. just from what began as a seemingly benign, helpful, predatory mortgages to real entire financial system here and people. in one of our hearings, we had a real retired subsidy teacher testify about how she lost equity in her home. so, the points i want to draw from that experience are three. one is people were talking about the crisis. there was not a consensus as to the problem. there was a tension between legislative oversight and drawing attention to the

problem, the desire for innovation, in an area, especially mortgages, which had historically been a safe investment and a large accumulator of well for people, and the kind of mentality that the market will take care of these problems. people will not lend money unless they know they will get paid back. if they keep doing that, they will eventually to get put out of business. i might pause here and ask if there are any questions? i laid it out. i am happy to go on. before i leave, i want to say one point. the biggest opponents in the beginning of the legislation were the accountants. they said, you will put us out of business and have always rules and regulations, you will

gum up the works. it will be impossible to do all this. there were a lot of accounting- it is hardionships. to grow a business. consulting, you could grow a lot faster. the accounting industry was very opposed to it. accountants came through. this was in 2002. as a staffer, you are always very cognitive of where your boss is during his term. when a member loses, his staff are all out of work. is not just the member's job at stake. luckily, the framers gave the senator six-year terms. by 2006, the growth for the accounting industry was of business and have always compliant. they were setting and praising

it for its great work. we were the first in line to say the senator's wisdom during the crisis was the reason he should see reelection and we would he did not.. that is another point. you serve at the will and pleasure of your member. when a member retires, when the member loses. there is a very real connection there. it creates excitement. it also creates a real risk. the broader point i am making in the accounting area is where business is during the discussion of a regulatory time, if you think globally, you can have a time where the market determines it, and hopefully

not, but sometimes a crisis. and it draws a redrawing of the regulatory structure. there could be a lot of debate about an input from people in the industry. once it is drawn, the viewpoint as to whether or not that will be a success or failure, could change radically from where they were at the argument of the redrawing. this is not a bad thing. the industry business should be arguing and rigid on behalf of their own incentives. smart people say, why did they not see that? that is a good question. you can also see the concern that there would be a new set of rules. i am afraid i will not know these new rules and they will be bad for business.

uncertainty is bad for business. certainty is good for business. if you think in a different way, from a broad perspective, the government job and policy job is to set the rules and certainty and allow business to interplay in that space, and innovate and profit and serve their customers in that space. when there is uncertainty as to what that place will be, that is where you get concerned and interplay. sometimes, as we discussed, there is -- when the rules are set, people start to see that maybe the rules are not working. in 1994, congress passed a home ownership and equity act, which required the federal reserve to have rules about certain types of loans that were high cost.

they got a red star. there was going to be a stigma attached to that in the marketplace. congress would require agencies to issue rules. there was no enforcement mechanism to that other than the annual corporation cycle. for very good reasons, the vast majority of financial regulators are off of congressional appropriation. you cannot really enforce that. the rules required to be written in 2006 and finalized in 2008. any serious study of the financial crisis shows the build up and concentration of risk in proliferation of the toxin mortgages, the die was cast in 2006. and nothing's happened in the system and they were sliced and

diced in so many different ways, even if you cut off any new supply in 2006, which did not happen. the market cut off the supply of these well before any regulatory red star to have an impact. people were talking about this. >> talking about accounting firms, i would like to ask for your thoughts on the concentration. when i started little ones, is this a too big to fail situation? what are your thoughts? >> that is a very good question. very analogous. there are certain economic reasons for accounting. first off, just complexity and size to handle large firms. second of all, a desire to have brand accounting.

one of the big companies. that is a natural value to having a large program. then there is a pressure. onere are two separate ones. is merger. the failure of anderson, the account that failed enron. there is an analogy in the banking space. it was very hard to have a big bank in multiple states. congress changed that. for a variety of reasons. a lot of great innovation, national branching and atm's, people move around a lot. then you have a crisis and what happens? firms merge with each other. you get down. only large firms can absorb other large firms in distress.

with regards to accounting, the best answer would be organic growth of new forms that could then repopulate the space. whether four is too small, versus two, verses 8, versus six, i do not really know the answer. i do not have enough knowledge. i do not know if there is enough to get out there to show a certain amount. two would be problematic. four is better than two. it could be better than four. you cannot have 30 household accounting firms. but it is a concern. what happens after the next crisis? what if another one of these go under?

due to bad management or competition or desired merger between two of the big four? that is a real big concern. turning just for a second to the seeds of the crisis, because my committee was banking, housing, and urban affairs. urban affairs is public transportation for the most part. why are these things together in congress? why do they form a committee? it used to be called the banking and currency committee. the same committee controlled banks. it is an interesting question. housing and banking are inherently interrelated issues. they are for a very good policy purpose, and in america, we have created a three-year mortgage with a one-way option. that is a pretty unique

situation globally. it allows for a tremendous amount of growth of home ownership. home ownership, for the most part, was the greatest way that middle-class families, particularly families of color, could accumulate wealth. you pay the mortgage, 30 years, interest rates are in your favor and you can refinance, and you are fine. at the end of the day, you are home free and clear. it is kind of a stealth retirement savings way, but also a way to transfer. if you had to guess, what percentage of houses in america are owned free and clear? 20? five? 30? close. one-third. luckily, one third.-- roughly

one third. that is a lot. right? two-thirds have some sort of mortgage, and not all are 80% or 20%. another reason it is a financial vehicle, you can work money in the stock market. you can never beat the market. unless your name is warren buffett. regardless, you really cannot get leverage in the equity market as an individual. you get leverage in the housing market. even at 20% down. the traditional down payment level, pulled aside 10% or 5%. when you are leveraging on your home, the largest asset for the vast majority of americans, that is a vehicle to create wealth in a long-term, sustainable way. historic the very safe. i will make another analogy. cars are fantastic. we all use them. they are really safe. you drive around. you have to be careful.

you can get into an accident. for the most part, we drive thousands of miles a year relatively safely. with defective brakes, you would be in a world of pain. you would have very little chance of making your destination safely. your experience when your car crash would be, cars are really risky. think about a more simple analogy about mortgage products. traditional, pretty safe. interest only payment, undocumented loans, pretty risky. balloon payment option arms, pretty risky. >> to follow your analogy, taking away the descriptions of driver's license, we let people in the market who have no business owning homes, risky and

with ky income nothing at stake, and then we were surprised we treated volatility in the housing market. >> hold on. i agree with your sentence. i would say, we is the market. to be very clear, the very types of products you are describing, originated, the best part, they originated by mortgage brokers, not by banks, it is not sound underwriting. it is not a good product. it is not what banks do. community banks say they did not make bad mortgages. i think they are telling the truth. large banks did not indicate the product for the most part, either. a lot when mortgage brokers falling directly through in securitization on the private mortgage market, private labor security side. that was the financing chain.

the alignment of sentiment in the chain that allowed that to happen were such that everybody was getting paid based on volume, not based on quality of assets. at the end of the day, the only gate keeper of the quality of assets was the rating agencies. they model, a simple model errors, let's model off the last therears of housing crisis, are no zeroes. i can start my day in a positive range, did not contemplate the situation. i remember discussing this with rating agencies, a lot of different folks, saying, if you take 100 that mortgages together, that does not make one pool of 80 good mortgages. that makes 100 bad ones together.

if any of you are taking the analysis, they assume 0 between the mortgages. if you have to 28 in tampa, you have nothing in common with the 228 in fresno. that is a mortgage in which, a 30-year mortgage in which the first two years are to appease -- to a teaser interest rate. i can underwrite you in the scenario based on the rules of policy makers, for the question of whether or not there is a high-cost loans. i could underwrite you to your rate. as long as you could make payments for the first two years, even if you cannot make them for the next 28, that is fine. shockingly, that does not work out. it will work if the house value continually increases so after a few years, you can get paid. in that mortgage space, there

are frequently large payments, a pre payment penalty, penalties and fees only unique into these other spaces. that created assets that were aaa. these assets that were aaa were viewed as housing assets. it has historically been considered less risky for a series of different types of investors, including financial institutions, to hold on to their balance sheets. investors thought they were buying something safe come with a little bit higher yield. you could sell the security on the blend of interest rates of all 30 years, so that is appealing if you are an investor. if you are an issuer, you pay by volume.

the more and more you can create, which created an incentive in the marketplace to get more and more people into the types of loans that give higher and higher fees. >> a question on one of the statements you made earlier. we know interest rates go down. earning a long-term bond as an investor is not a good investment. short of long-term bonds, which it has been that the average homeowner would have been much better off with a four-year mortgage. it would have floated down. what the fixed-rate mortgage has done is given financial institutions the chance to charge over and over again as people refinance their mortgages, at rates higher than they would have otherwise done. in some cases, a dozen times.

>> i will answer your question. let me do something first. first answer your question with a question. if i have a life insurance policy on my life for my children, say i want to do a 20- year term. my kids are 20 and they can take care of themselves. i live for 20 years. that insurance policy, does it produce value for me? has it? >> it has produced insurance. >> yes. the insurance has value. by that, i would take your point. in retrospect, in hindsight, always having a variable rate mortgage would have been the answer. having gone the other direction, having 30 years would have produced the opposite. but they have the 1-way option.

the homeowner, by fixing your rate, he gets the value of the fix and, because we have a 1-way for repayment, a unique structure, they have the ability to take advantage of the downside. do they get the full advantage? nope. that is correct. but they have the value of protection in the upside. if people view the risks asymmetrically, and the cause of foreclosure is incredibly high, and i am willing to pay premium to have a certainty of value in depending on how you measure the insurance premium we discussed. to go the other way. >> a 30-year mortgage has been a rather expensive pathway for people to have a peace of mind. does not help people to build wealth. you pay for an insurance policy never used.

going forward, i probably agree it is a good idea because interest rates cannot go down too much more. >> i would have said the same thing several years ago and been proven wrong. the prospective ability to forecast on behalf of interest rates is difficult. the average of a family of four on a $50,000 a year income with some college education, the median level of education in america, may not want to constantly be making forecasts of future interest rates. the other point to you is, and the chairman said this, he said, i am perplexed why people opt for a 30-year fixed. very different from a no documentation, no money down, there is a long history of available alternatives. people opt for that.

you can pay people are steered. you can say different aspects there. those types of products are available. it is a very different product than a 228 no money down. >> the other point, 36, [indiscernible] >> we can go back one more crisis. it is an interesting point. this will relate back to the dodd-frank point. the savings and loan crisis date back to a time when there were things called banks and things called threats. a lot of people in the country do not recall those distinctions. they go back all the way to the great depression and before that when banks had the federal reserve system and the federal home system. over time, the distinction

between a bank and a thrift, to the average consumer, oppose-- post- 1990, is impossible to distinguish. they were still regulated by two different regulators. then the various federal banking regulators, the currency of the fed, the fdic. they were not even emerged in 2005. the fdic operative both of them. he said 2006. you are right. >> the merger was way back when. the fdic kept two different funds in a safe. the bank insurance fund and the savings association insurance fund. they charged and had different rates and statutory guidelines. you may be right. i worked as a staffer.

it is very hard to remember what year sometimes laws passed. work on them for so long. from the beginning through to the end. dodd-frank ended one regulator. the office of supervision. it was the only regulator that basically ended in dodd-frank. a lot of the most problematic loans originated through the thrift. if you look at the larger thrifts, countrywide, and they had a greater share in this space of toxic marches, i want to pause because we have gotten deep into the housing side of the crisis.it is an important crisis. highlights why banking and housing would go together on a committee of jurisdiction. this is why we had the

advantage, as congressional staff, of knowing both markets. the banking market and the housing market. when you are a congressional staff for a committee, you are assigned as the head democrat or had republican of the committee, when is a chairman and one is the ranking member. that is the head of the minority. he served other members of the committee to ask questions. that is your boss. it goes back and forth. you learn areas with in that committee's jurisdiction. things outside of that are not in your control. one way to think, if i can impart anything on the audience, as a better way of students as you go forward, to think about congress, think about committees and jurisdiction. it is a world of jurisdiction. when the jurisdiction of committees align with the reality, that tends to produce a better policy.

when there are abstractive is as between the two, if that makes sense. in this case, the banking and housing jurisdictions were aligned. in fact, if you look at the legislative chronology, the first major sweeping reform in the financial crisis was the housing economic recovery act. it strengthened the regulatory oversight, combining that also with the regulatory oversight of the federal banking system, which i mentioned before, funded a lot. so that was the first legislative process. the second was the enactment of the emergency economic and stabilization act. tarp. that, which is what most people know the bill by, after those two laws, there was an attempt to do a similar legislative fix

for the auto companies. under the offices of banking housing and urban affairs industry, if you think about a bankruptcy as a systemic nature, a company being so large it goes to bankruptcy and the finance is the government. businehis maks sense in a ss school context? the private market, for whatever reason, is unable to provide better finance, either it is too large, or it is itself. you cannot fund your own recapitalization. you can think of the government alloy. chrysler went through the committee in 1979. that legislative attempt failed for gm. after president bush signed off

and the house voted for it and it was filibustered in the senate. after that, we did a reform with a credit card industry. then dodd-frank. i put the markers out there. the attempt to do the otto,-- autos, which were then dumped throug-- done through tapr. -- tarp. the credit card act, and finally, dodd-frank. a framework to, in hindsight, understand how to tackle the problem. one was emerging crisis to crisis. the reform bill, the basis of which dated back to the 2005 attempt, which passed the house but not the senate, why, because fannie and freddie were on the

precipiece and had serious problems and the secretary of the treasury said, his famous line at the hearing was, i need a bazooka. i hope never to use it, but i need a tremendous amount of firepower. it was enacted very shortly after. it was a power the regulator lacked under the previous framework. that pass at the end of july. tarp past october 3. i will take a liberty because i think it might be fun. the staff experience this in a way that is different from a member spirit also different from the general public. the secretary of the treasury and the chairman of the federal reserve and the leaders of congress said, we have a real problem and we need a lot of money and we need it now. there was a series of debates back and forth n the legislative process to craft that framework, and it met with tremendous public opposition. the president went on national tv and stepped in front of the

podium and said, if we fail to act, we run the risk of another great depression. that is a startling statement for the chief executive of the country to make. the state of the union is strong. there is a certain amount of optimism inherently put forth by all chief executives. that is also true in a business context. i do not think that is unique to government. if you're chief executive of your company walks into the board meeting and says, we are at the risk of imminent bankruptcy, that should startle a lot of folks. he is not quite an elected official in the same way a politician is. all of that pressure, an context. i do not think that is unique to government. agreement was reached on a deal. the agreement was signed off in a press conference, the president has clearly delegated almost all of 32 in the debate. the majority leader and the

minority leader in the senate. the speaker of the house and the minority leader of the house. this is a signal to everyone in the world this is a done deal. and everybody at that level, the heads of the party in power and the heads of the opposition, and a blessing of the two presidential candidates running at the time, neither of whom campaigned in opposition to tarp. the market resumed they had it fixed. we will understand the rules of the fix and how it will enter play through. what happened? the house went to vote on it. while the house was voting on it, senate democrats had their emergency meeting where they were getting briefed on what the deal was. the staff was waiting outside the room. minority leader in the senate. the democrats always meet in the lbj room in the senate. the staff was sitting right outside the lbj room to join the

senate floor, waiting to get called in to answer any of the more technical questions about the deal. there was a tiny little camera to watch c-span live on the floor and see what is going on. we took to the security guard station tv over and turned it over to cnbc, which had a famous shot of the market watching, a split screen of the doubt and the dowll role vote.-- and the house roll callk vo -- call vote. it was going down. it was going down primarily because of opposition among republicans and congressman. the market dropped 1000 points like that. it looked more like you're

watching a nasa countdown. than you were watching the big boy. at the time, one of the white house legislative affairs focal worked out of the vice president office in the senate, the head of the senate, according to framers, and we ran into a man he looked at us and we look at him and said, plan b? it was not like there was a plan b. this was a surprise. they did not know who was in charge. they did not know who was setting the rules. if the president, and the speaker of a different party, make a deal, and the minority leader is on board, these things do not go down. it looked more like you're given the uncertainty of the crisis happening in the real economy, the fact that the government said they had the deal and did not have a vote to make it happen, added a layer of fuel to the fire and panic that was gripping the market, that was palpable and real, potentially avoidable,

potentially necessary, depending on how you look at the view of elected officials in responding to constituency. polls were 90% against this thing before the vote. there was an election eight weeks later. after that vote, the market fell. when we came back, the senate voted with 74 votes to approve. a very similar package. there have been minor modifications. as well as other kinds of legislation tacked on that had nothing to do with the financial crisis. that passed with 74 votes. i ran a little bit of a congressional pool, march madness.

there was no money at stake. i asked all the democrats and republicans to work on this to give me their vote total. out of the guess is i got, only most one crowd of 74.-- were lower than 74. only one person guessed 75. we knew it would pass. we did not know it would pass that support. you had a question. >> [indiscernible] i want to know what the best way is. >> a very good question. the first thing, congress gave them the same regulator. prior to that, the banks had their own regulator, a large board, the homeowner bank board, not what i would call a premier this sounds

a little bit silly. there is truth to this in washington and the business world. the business context, people said there were investment banks by prestige. the they collapse exactly in the inverse order of the prestige. there is a little bit of that here, too. a regulatory system is only as good as the people operating it. at the end of the day, the best people make the right calls. people who are not as experienced or knowledgeable with as much connection, have a harder time. i say connections because there is regulation with power rules, and this and that, then there is regulatory soft heart. we would really like you to do this. we think this is a good idea. or we think this is a bad idea. different regulators listened differently when they say that. at the height of his power, the

fed chairman -- people listened. the home loan bank board, whose chair was during the mid 2000's, was indicted for illegally for fund raising from embassy was deregulating from. that regulator was not as aggressive or lack procedure and tigebility.-- lacked pres and capability. the office of federal housing enterprise oversight failed, which was one of the few financial regulators still on appropriation, subject annually to a budget from congress. if people regulated them to not like what they were doing, they could go to congress and say, why did you cut their budget? the regulator was moved off of appropriations. it was able to exist on the fees

it charges. it was given far greater regulatory authority as i mentioned before. it was given one single director. it was given one single director. the home loan banks had a board. i would say that the attempt there was to produce a stronger regulator where you will get a more qualified person with greater gravitas to regulate the people a place where would want to work, where the institution would have more power and authority. how much that has been successful or not, difficult to judge. first, fannie and freddie were put into conservatorship so quickly after it was enacted that it is hard to say -- i

mean, regulating as a conservative is different than regulating a company outside a conservatorship. secondly, the home loan bank system, which you are right, plays a vital role in security, as you may or may not know, was the first failed institution is the first holdover after a failed institution from the fdic or the federal reserve. the home loan banks are private cooperatives owned by the different member institutions. they're not government entities like the federal reserve. the federal reserve, they do not return dividends to their shareholders and profit the hormone system the way the banking system does. -- the home loan system the way the banking system does. the banks used to regulate their local thrifts, much like the way regulate.anks

and a different talk for a different day could be the history of thrift crises. i think that is a major attempt. we do not live in a normal world in housing finance. 90% of all mortgages originated today with some sort of guarantee. is not a healthy or sustainable market in the long run. it does go to show you that absent any government role, there would be almost no housing market. you have a question. >> what is the level of staff for support for congressman? and what is that background? >> that is a fantastic question. the average senator -- i worked

in the senate. my wife worked in the house. we have a bicameral relationship. [laughter] and i would stress that there's a real distinction between carolla sum and party that i do not think it's fully appreciated. if i was giving a lecture to political science as opposed to business i would say, study cameral is some more, because it is real. the average center -- a senator has a legislative staff of about 30. their home district offices, which vary in proportion to the size of the state. the senator from california and the senator from wyoming are equal senators. pretty different. you can imagine one may have a little bit more mail than the other. legislative staffs are a little bit more comparable. the average office is about 30 staff in the washington office,

roughly. you have maybe about 10 legislative correspondents where usually people are straight out of college. the draft male and handle constituent requests. they help support legislative and they are broken down by committee assignments. the average senator can sit on anywhere between four to six committees. -- some of them become committee specialists. have everyor has to issue covered. or sevense six legislative assistant, there is one legislative director that makes the final sign off for a vote recommendations, etc., and then you have a chief of staff. you have a separate schedule inside, a press side. your cataloging and handling the mail, which is a pretty cardin

joran task. handling hundreds of thousands of correspondence annually. degrees have graduate or lengthy experience in congress on the senate side. one of the reasons i went to graduate schools for that of undergraduate is because i had been turned and i saw that the grad degree buys you into the legislative assistant world in the senate. in the house, the average congressman has probably about seven or eight staffers. there are usually about -- there is usually one person -- usually have about four legislative assistants. the average congressman said on one committee, maybe two. usually, there's one person on a committee and then the the three or four split up the rest of the world. there may be one or two legislative correspondents. there may be one helping the committee, and then somebody handling everything else.

the average congressional seat about 6000 people. you have mail, but it's a different order of magnitude than being a senator. yadier chief of staff, press operation, district offices, which may play better about larger role in a congressional office. very --ittee staff's the committee staffs vary depending on the body. there are a, b, and c committees. you cannot serve on more than one a plus. you need a waiver to serve on more than three committees, etc. the house committee staffs are a little bit larger than the other staffs. house financial services committee has a little bit less jurisdiction because they do not have the transportation stuff that the senate committee has. it has about 70 to 75 members in

any given year. this and have about 21 -- 19 to 25 members in any given year in the senate. typically, committee staff have advanced degrees, a lot more specialization in their subject lessr, and a little bit general understanding of either the constituent issues. business,d to business tends to interact either with the members of congress that represent your corporate locations, or the committee of jurisdiction and the committee staff that represent their interests. all the banking trade associations, housing trade associations, we all interactive frequently. if there was a mortgage company based in maryland or based in connecticut -- and in connecticut, new the head of the bankers' association. i always knew the people at the

american bankers association. does that give you a direct answer to your question and then a broader answer to the business school students? and the same thing is true with any of the other kind of trade associations. there are the national people and then whoever your boss is. >> the consumer financial protection bureau has no confirmed it director and may not have any legal director at all, depending on what the supreme court decides. the supposed reason that the republicans in the senate did not want a vote on this is because they wanted to change the funding of this agency. they wanted to be congressionally appropriated rather than financed by the federal reserve. a very legitimate argument in favorthe supposed reason that oy agencies funded through congressional appropriations? or is this a smokescreen for

saying they do not really like this agency and they want to kill it? >> our answer to the question -- i will broaden its scope slightly. the two big bills are worked on were? frank and harrah, they created two new regulatory authorities. in both instances, which traded one single confirmed director. neither had ever been confirmed by the senate. harrah was passed in 2008. -- frank in 2010. here we are in 2013. in 2013.-frank we have done research that will be released next week looking at the question of how long does it take to get independent regulators confirmed, and does it matter if you have a board or the chair of a commission? because often the chair has enhance legislative powers, or as a matter of the practice of the agency, enhanced powers.

it is interesting that these single agencies have a hard time getting confirmed. and a schizophrenic, and in congress in the sense that congress created the agency with one head, but then did not do it. is much more controversial than the hfha. there has not been another perhaps somewhat surprisingly, given the problems in housing market. the comments of the -- about the governance structure i would dissect. one is combine the operations. . two, there's a lot of concern about having power with one person. i would point out that the office of the comptroller, which

was the first currency banking structure -- the first national bank regulator. there are two national banks that andrew jackson and did. that was passed by abraham lincoln in 1863 and has had one confirmed director ever since. cftb a lot of ways, the is modeled after the occ in its regulatory structure. appropriations, governments structure, and board members, and the third issue you raise is about the federal reserve. -- fun find a regulator of regulator by payments that are appropriated annually by congress. by a self funding stream, which is usually assessed by the regulator. that is how these banking industries have historically worked.

or if the regulator somehow makes money in the course of its operations, the federal reserve is granted the license to sell money. that is a profitable business model. i would say, the license to print money, which is the vernacular, but technically, the amped -- the bureau of printing and engraving actually print the paper. the printed dollar cost 4 cents and then they sell it to the fed, and the set -- and the fed sells it for a dollar. it is a pretty good business boller -- business model. the fed then spends its money on regulation and research as it sees fit, and returns in excess profits to the treasury. -- frank creates a unique structure -- the question was, how will these efp be get funded? out, it didinted

not work well in the gst context. abouts a lot of concern how it works with bcs -- the sec and the cftc those are the other regulators that our purpose -- that about how it works with are. it. ironically, and the stock market, you pay -- suggested the numbers from kato. 0.003 basis points. it is 33 cents per $10,000 of stock sold. buyingt many people are or selling $10,000 worth of stock on a regular basis in their individual accounts. but you pay that in the aggregate, plus a couple of other fees on the issuance of and collecturities

roughly the sec's budget. but the law does not allow it to go straight to the sec. it has to go straight into the general fund and then congress annually appropriated. what you have seen is that congress is requiring the fcc to do a lot more work, a lot more regulation, and has not increased its budget. the president has repeatedly asked for more budget. and then you look and say, has dodd-frank been a success? do and jobsjob to cost money. i would say the following. there is an important role for oversightn terms of of the regulated entities. congress can exert oversight. congress has two powers that i call hard powers, the power of the purse. that is, to give agencies money or not. a classic example, the executive branch or independent regulators

cannot spend any money that congress has not authorized the use of. and the power of laws, the power of legislation. , orhave this authority requiring you to do this or not. on the home-equity protection act, it was not as if the federal reserve said they may regulate. it was, they shall. what could you do? you could not cut their budget. a series ofo has soft powers. hearings, letters, phone calls, public speeches or statements. , some remember the brouhaha when members of the republican party work running for the nomination and they talked about chairman bernanke.

that had a big splash in the media. other times when people have called for an audit of the fed, this or that, there is a hard power and the software. regulators have power, two -- have power, too. when paulson's statements are given, or speeches are given by any of the big regulators, industry this is. they want to know where they're rules of the road are going and what the shape of the road is going to be. they want to be squarely in the road within the accepted boundaries and rules for profitable purposes to accept -- serve their customers. during my times as staffer, i probably overvalued hard power and undervalued soft power. when i came to treasury, i was shocked that soft power, letters, a hearing, a threat of a hearing could and jammed

things in thejam regulatory or bureaucratic structure in a way that law was not feasible. terms of id, congress and the executive branch have a very defined relationship in the constitution. over time, we have created a financial regulatory branch that has been given a certain amount of independence from the executive and a certain amount of independence from the congress. and in general, that has worked well except where it has not. and not all of the regulators have the same degree of independence. the feeling on the consumer and i think that is a greater study. the feeling on the consumer bureau was that it should have the power and prestige of the banks.

the banks are not funded. they're not on appropriations. it should follow a similar model. and then the question was, how? do you charge a separate assessment? it also has the power over nonbanks. the federal trade commission is an example of someone who is supposed to regulate in areas, but has been on appropriation, and is very hard to figure out what the assessment scheme with look-alike. especially because the universe was not necessarily defined as non-bank financial providers. and there does not seem to be appropriate middle ground to the drafters at the time. amount ofd a certain revenue stream. it provided a certain amount of prestige that would attract people to the new bureau. but it was written in such a way that was basically functionally autonomous and just sends the

fed a budget, and then the fed send them a check. there is no reason you could not do that with a wide variety of programs. something that policymakers -- there was a new president in the bureau, and something that i think people should think long and hard about as to what precedents that sets. >> [inaudible] [indiscernible]

>> a couple of things. the project that i work on at the bipartisan policy center with fell and martin and others is tackling just that. we are just -- asking just that question. what did it wrong? what it means? you can see something that you think made sense. the creation of a coordinating committee in terms of the fsoc. when you live through the experience in real time as a staffer, you were there on the weekends following what was happening and you were trying to call all the regulators and find out who is talking to whom, the lack of a real coordination mechanism delayed the government's response. the establishment of the council was a real step forward.

are too early to tell. of the things you think, wow, the credit rating agencies had -- really got it wrong. ofy said aaa on a lot things. aaa as a meeting of probability of default. they were wrong. i do not think there were enough meaningful response -- reforms in that space. why? there were many people in the discussion. our big project that we're working on is trying to answer that question. we will be rolling out a series of white papers, the first dealing with an ability to resolve failed institutions, which was a major problem in the crisis for how did you resolve aig, bear stearns, lehman brothers. and that often gets into this too big to fail debate, which i know has been called one concept, tpt.

but it is actually two concepts. our banks to big? are they too big to fail? concepts two different tod-frank sat out regimes deal with those bits of regulation. the task force came out with a statement that one. there should only be one vote rule. as an example, retorts coordination. there are five or seven bodies trying to ride in the volcker era rule. and at one point, there was a discussion about whether there are different volcker rules. capitalism is what we were gone, and it is the government's job to set the rules and let the market innovate with in that space. you cannot have two different sets of dotted lines. getting back to the driving analogy, there has to be one

double yellow line. you are on this side or that side. it is difficult to assess. there are areas where i think it has made improvement, areas where it works. there is a natural cycle on that. how many of you read the "washington post" today? they did aversary -- one-year anniversary of the jobs act. it traded a place for access to capital markets for smaller thatnies, crowd sourcing, type of stuff. there was not really crowd funding in 2002. aboutere is a debate whether or not the loosening of regulation was a success or failure one year later. i do not know if it is too early

to judge, but that is the story in today's paper. there's a cycle of crisis, response, review of the response. what is unique in dodd-frank is that the legislation in the banking space, the legislation passed by 60 votes in the senate, the bare majority, the history of all of these crises have been larger, more robust bipartisan deals. steidle past glass 90-10. the responses to the thrift crisis passed by well over 80 votes in the senate. got as far back as the 1950's, which was the response to the problems with drinking in -- in the 1940's. that past by a worse vote. i think there was one other big

bill where there were more that voted present and voted no. -- a ban voted no. -- that presentvotedat votive than voted no. the red and blue maps have come to dominate america. there are far more shades of purple throughout the company -- country. congress has a lot of constituencies at play. i urge you, as you think about interacting with congress from a business perspective and as business students, think about who your constituency is, whether it is literally as a constituent to your member of congress where your company is located, or the other companies

that form your constituency from a business or intellectual or ideological position. and think about the constituencies that your allied with, those that you are opposed to, and think about congress as a battle of constituencies. as opposed to partisan fighting. betweena lot of overlap parties and constituencies. but it is not always there. >> speaking of constituencies, publicre any lingering misperceptions about financial markets and the way that government interacts with markets, and how it should interact? and if there are, how has it made it more challenging for the government in this situation? >> that is a fantastic fit -- fantastic question. understanding public perception is very difficult when you are a congressional staffer. there's a certain bubble that

exists when you are dealing with elected officials, senior people in industry, and consumer aside and advocates, and understanding the kind of popular sentiment from voters. you get that feed back every couple of years in an election. it is very difficult to understand and two pars what the voters are telling you. parse what the voters are telling you. members of congress delayed because they go home. i happen to have a convertible with "saves the day" tags. i'm a good marylander. i drove in the silver spring parade. i drove in the greenbelt parade. it was a very illustrative experience for me. and by the week, that is not something that a committee staffer usually does.

at them oneople yell the parade route. what were people thinking? it is a vulnerable experience sitting on top of a car driving 3 miles per hour with hundreds of people lined up screaming things at you. when we did the thanksgiving day parade, it was also cold. that being said, you begin to realize what people are responding to is what they are reading, what they are seeing on tv, what they are experiencing in their daily life. and there were some misconceptions. i would say one misconception is that i believe without charge, there would have been -- without there would have been a much more severe depression. recession. i think he would have had a far worse scenario without t.a.r.p..

americans could have gone to supermarkets and the schultze would not have been stopped because the stores could not have -- and the shelves would not have been stalked, because the stores could not have bought paper. i cannot prove you what the world would look like without t.a.r.p. i can prove that it did not cost $7 billion. is a common misconception. the majority of that money will lead to financial institutions with annual appropriations in which the government spends money. number one misconception, t.a.r.p. did not cost $700 billion. absent the money spent on housing and as in the money spent on the auto industry, it may even be -- and absent the money spent on the auto industry, it may even be profitable. it is too soon to tell. the taxpayer return on investment in t.a.r.p. i think

was extraordinary. and i say that because it actually cost people and what been a few wehave had not acted in terms of the detriment to the economy. -- if we had not acted, in terms of the veteran to the economy. another misconception, i think people are trying to do the right thing on both sides. maybe this is the i.t. that i started with about the value of e that i-- the naivet started with talking about the value of service. i went back and forth. i worked with my republican colleagues. they wanted to make america a better place, too. so did die. maybe that is why i joined a bipartisan policy center. thatmay have thought different things would have made

america better. they may have thought that when i was proposing did not achieve our shared objectives. that is a totally fair and find a place. place.e but we both believed in different things. the years in my public space, that is what has concerned me the most, the deterioration of belief in the other side. public iserican frustrated. no. so, from what they are seen. but the majority of -- rightfully so, from what they are seeing. but the majority of republicans want to make america a better place. we just disagree on what rules the government should set to achieve those shared objectives. if we could all get back to that place where we agree that we all want the same right outcome, then it set a much better stage

to find out what the rules should be. thank you all again. [applause] [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2013] a we have another speaker in week and a half or two weeks. april 23, excellent. thanks very much.

>> we take you live now to the state department. this is the benjamin franklin room. senator kerry has been meeting today with south korea's foreign minister. the topic of their agenda has been north korea's nuclear program and threats against the united states and south korea. north korea announced plans earlier today to restart a nuclear reactor it had closed down more than five years ago. also today at the united nations, the secretary-general said he was "deeply troubled" by recent statements by north korea's government. zakaria's foreign minister and secretary john carry out -- south korea's

foreign minister and secretary john kerry out in just a moment for statements. >> at the state department waiting to hear from secretary of state john kerry and the south korean foreign minister. earlier today, north korea

announced plans to restart a nuclear reactor that it had closed down more than five years ago. in briefings across washington today, officials responded to that. at the white house, jay carney said "the entire national security team is focused on it." sayrsha you what he had to while we wait for secretary kerry. -- i will show you what he had to say while we wait for secretary kerry. the statement today from junying is that it will restart its nuclear reactor. does that give you pause? and it's a concern to you that this may be a familiar pattern? korea fact is that north 's announcement that it will restart its facilities is another indication of a pattern of contradicting its own

commitment, and a pattern of violating its international obligations. as you know, that facility had been shut down as part of an agreement. north korea, at least for this announcement, seems willing to violate that. and there's a path open to north korea to achieve the respect and economic development that it seeks, but this is surely not the past. as i said yesterday, it is our position and the position of broad international alliance, if you will, that north korea must abandon its pursuit of nuclear weapons and abide by all of its international commitments. we seek the complete, verifiable, and irreversible to authenticzation and credible negotiations. the u.s. and our international partners have the shared goal of ensuring the safety of the korean peninsula and we have a

strong common interest in the peace and stability of southeast asia. we're working closely with our allies in the region. we are taking appropriate measures in response to the bellicose rhetoric and provocative actions out of north korea. but it is -- these actions and withrhetoric is in keeping the path by p'yongyang. juceam a little more a large alarmed.- more -- you seem a little more a large. does the president agree? >> the president has expressed concern about the actions and behavior of the regime of north korea. we have worked with our allies most recognizably at the united nations security council when a

resolution was passed unanimously with china and russia condemning north korean behavior in this arena. and we will continue to do that. and the steps we take together with our partners put more pressure on north korea, isolate north korea, and make it clear to the regime there that there is no benefit to the north korean people on the path that they are taking. meanwhile, we obviously take the to ensure they path to assist our allies and the united states. >> watch all of that and our websites c-span.org. back live to the state department waiting for secretary kerry and the korean foreign minister. they have been meeting on a number of issues.

the associated press reports that's the koreans and north koreans said they will quickly begin readjusting the start of that wereties shattered as part of the nuclear disarmament talks in 2007 -- shittered as part of the -- that were shuttered as part of the nuclear disarmament talks in 2007. >> good afternoon. it is a pleasure to welcome the foreign minister here today in washington. it is his first visit here to washington, and my first visit with him as secretary of state. we are both delighted to start off this way. two very close friends,

countries that have traveled a very interesting journey together for 60 years now. we celebrate this alliance. for decades, the united states and the republic of south, the republic of korea have worked side-by-side as allied. we have stood up to a wide range of challenges over that time just in the asia- pacific, but in other parts of the world as well. when you look back at our common commitment to democracy, to human rights and rule of law, it is no wonder that we have been such natural partners. our alliance, which is in this moment of its 68 anniversary 60th anniversary celebration remains critical in asia and it is a linchpin of

peace and stability in the region. the united states is completely committed to deepening this relationship in the years ahead. that is one of the reasons i will be visiting seoul next week. , ofthe president of korea the republic of korea, will be here to meet with president obama in early may. today, we discussed all the issues that you would imagine we would, and even more. we covered a great deal. but i will start with north korea. amountd an extraordinary of unacceptable rhetoric from the north korean government in the last days. let me be perfectly clear here today. the united states will defend and protect ourselves and our treaty allies, the republic of korea. the foreign minister and i also

think it is important to stay absolutely focused on our shared goal of a peaceful korean peninsula, free of nuclear weapons. and we agree that improved relations between north and south would ultimately help us toward that goal. that is a stated goal of the new president of the republic of korea, and we look forward to working with her to achieve that goal. we also discussed our collaboration on global security issues. south korea has done great work on the un security council helping to curb civilian casualties in combat zones. and they have done that work not just in the far east, but around the world. we are also grateful for south korea's continued commitment to reducing iranian oil imports. this has not been easy. it is at a cost to their economy. it is difficult.

but they have played their role and done their part in helping on trying topact change the behavior of iran. iran knows exactly what it needs to do in order to address international concerns about its nuclear program. it can start doing so next weekend in al-madadi at the p-5 plus one talks. ways to workssed more closely on the humanitarian crisis in syria. of i thanked the republic korea for their support on humanitarian concerns in that area. we also shared an initiative on sub-saharan africa, and we thank them for that. in terms of bilateral issues, the foreign minister and died both want to promote the smooth implementation of u.s.-korea free trade agreement. this agreement is good for both

countries and it will strengthen our broad economic ties. it will spur growth. it will help to create jobs in regions.tries and we also had a good discussion on the bilateral civilian nuclear agreement. we have a long record of close collaboration on this issue. we are committed to fighting -- finding a workable, and expeditious way forward. finally, we are also both deeply concerned about addressing the problem of climate change. we discussed that. we will have further discussions when i go to seoul next week. we both support clean energy balad. will be looking for ways to work closely -- energy development. we will begin looking for ways to work closely together as we look at the issues of climate change over the course of the next few years. it was a very productive meeting. i hope, the first of many in the

years ahead. mr. minister, i look forward to seeing you again in a very short timeframe. and i thank you for your commitment in this important partnership. and i thank you for coming here today to prepare for the import meetings of our leaders in early may. thank you. >> thank you. good afternoon. i wish to thank secretary kerry for his invitation. we had an excellent meeting today. we discussed a wide range of key issues, including our reliance korea,alliance, north and our agenda. this year marks the 60th anniversary of the caribbean- u.s. allies put in korea, 60 -ears symbolizes -- the korean

u.s. alliance. in korea, 60 years symbolizes the arrival of wisdom. in this regard, we share the the visit in may for president park, which will be your very first overseas visit as head of state, will be to bring our lines to a new height. the secretary perry and i pledged to make every effort to ensure -- secretary kerry and i pledge to make every effort to ensure the summit is a success. situation onthe the korean peninsula, including north korea's nuclear testing as well as the series of threats from the north. we need to further strengthen .redible and robust deterrence

in particular, the secretary and i discussed the progress made with the standard deterrence and the provocation plan. my government's strong commitment to work closely with the united states on north korean policy. both secretary kerry and i agreed that north korea should abandon its nuclear ambitions and rhetoric. we also agreed to collaborate to ensure full implementation of the un's secret council resolution 1324. reiterated my government's policy of building trust. i also emphasized that president park's new policy to promote peace and cooperation in northeast asia is in line with

the united states policies for asia, and that a mutually reinforce each other. our anniversary, but secretary perry and i will work -- secretary kerry and i will work toward the smooth implementation of the agreement. my government has a strong commitment to open the economy and free trade. moreover, we wish to strengthen cooperation in the fields of science and technology, space exploration, and change. and finally, i stress the thertance of revising agreement in a timely and mutually beneficial manner. i am pleased with the results of this meeting. i look forward to welcoming

secretary kerry in seoul next week. we will continue our commiseration. thank you very much. >> we will take four questions today. mr. secretary, thank you very much. i would like to ask you what you think north korea's intentions are. do you think this is just bluster? specifically, the recent threat to restart its nuclear facility. and is there a danger in not taking these threats to seriously, that it might provoke them into actually doing something? or is there a chance that they could pull back and be ready for diplomacy at some point? mr. foreign minister, the six party talks in the whole process has always relied on china to rein in the north, if you will. it does not seem likely that the north is listening to china in any meaningful way.

i'm wondering if you think that this is a safeguard that the parties cannot rely upon any more. as the influence that china has had been used up? regarding china's goal, basically, what we thought with the recent reduction of the un security council resolution, china is now very cooperative. and they have made very clear that they will fully implement the resolution. regarding the six-party talks, actually in this resolution, the six party members and the members of the council also made it clear the six party talks are still a very useful tool to effortst and make toward the denuclearization of the north korean nuclear weapons

program. we believe the six-party talks should continue. on whatl not speculate the intent is or whether there is a strategy or not. the bottom line is very simply that what kim jong-un has been choosing to do is provocative, dangerous, reckless, and the united states will not accept state.k as a nuclear and i reiterate again, the united states will do what is necessary to defend ourselves and to defend our allies, korean and japan. andre fully prepared capable of doing so. and i think the dprk understands that. lightly,, no one takes

least of all the president of the united states, what has been happening. which is precisely why the tosident made the decision redeploy missile defense with respect to the united states itself, as well as to take other preparations in the region, and to send a very clear signal to our allies and the north alike that the united states will defend our allies and that we will not be subject to irrational or reckless provocation. but, and here is an important clear andke it consistently that the united states believes there's a simple way for north korea to rejoin the community of nations and make it clear that they want to pursue a peaceful path. they can come back to the table and join all of those other

countries, including their nearest neighbor and partner china. obviously, the shared in u.s. -- the shared nearest neighbor is the republic of korea. but china has an important role to play. maintained as closer relationship to the north than any other country. an option. and that option is to enter into negotiations for denuclearization, which is china's policy also appeared and began to focus on the needs of also.people -- a policy and begin to focus on the needs of their people, which we have always made clear we will help them with, if they bring it in globalth the requirements. we will proceed thoughtfully and carefully as the president has indicated, but we take nothing

for granted. and we are also not indifferent to the meaning of the risks involved. >> do you believe they will restart their nuclear facility as they threaten to do? >> the first of all, if they restart their nuclear facility, that is in direct violation of their international obligations. that in itself would be a breach of international standard requirements. it would be a provocative act. and completely contrary to the road that we have traveled all these years upon the agreed framework forward. we will have to wait to see what happens with respect to that, but it is a direct violation of international obligations and would be a serious step. -- ext up, >> the first question goes out to secretary kerry.

right now, a lot of people are in the negotiation of the u.s.-korea civil nuclear agreement. several people are concerned that if they request low enrichment for people perk -- for peaceful purposes and it is not accepted, that there could be in repressions. do you see progress happening in this area? >> president obama and the united states welcomes south as a peacefulnce nuclear leader. we're working on a civil nuclear agreement that will build on a very strong nuclear energy cooperation that we have enjoyed for literally over 50 + years.

we see no reason that will not continue. upon fashion. the foreign minister and i had a very good discussion about that agreement. we discussed some ideas and i will follow up on those when i visit seoul in about a week. i'm very hopeful. i think the foreign minister shares this hope, that it can be resolved before the visit of president park. but we're quite confident that this is a relationship that can and will continue in its proper form. >> mr. secretary, in cairo last month, you from afpak $250 million in additional support for the marcey government, morsiing pausch for the

government on the promise that he would make more reforms. prosecutedcome -- more satirists than those involved in crimes. last week in baghdad, you spoke of the need for iraq to more closely monitor flights from iran to syria. the government there has said this weekend that it will do that. have you seen any evidence of that so far? and we respect to egypt, share a very real concern in the obama administration about the direction that egypt is apparently moving in. this is a key moment for egypt. it is really a ticking. point for egypt. and we have been working in the

last weeks to try to reach out to the government, to deal with the imf, to come to an agreement beginill allow egypt to to transform its economy and improve the lives of its citizens. everybodyith concerned about the political and economic challenges. and i communicated those concerns with everybody when i was there. i everybody met with the civil . i met with the opposition. to members of the business community. and i met with members of the government. we have put a series of very real choices to the government , but in the end, they have to make those choices. the imf is going there this week. there will be discussions with them. but it is only fair to say that president obama and the share realion

concerns about the direction that egypt appears to be moving in. it is our hope that there is still time to be able to turn the corner. i met and talkedbut the recent e violence in the street, the lack of inclusivity with respect to the opposition and public ways that make a difference to the people of egypt are all of concern today. president obama would make it clear to everybody that the united states went there, as i said, not to support any one person, and certainly, not to support one party over another, but to try to help the people of egypt to realize the dreams that they expressed in to rehr -- and to rehr square. and the dreams that they have tried to put into reality with the election and through faith in the democratic process. i think there's still time for that to be delivered, but in